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Full text of "North Carolina Register v.7 no. 13 (10/1/1992)"

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1 



The 
^fORTH CAROLINA 

REGISTER 



IN THIS ISSUE 




GENERAL STATUTES 

IN ADDITION 

Final Decision Letter 

PROPOSED RULES 
Agriculture 

Environment, Health, and Natural Resources 
Human Resources 
Medical Examiners, Board of 

RRC OBJECTIONS 

RULES INVALIDATED BY JUDICIAL DECISION 



CONTESTED CASE DECISIONS 
ISSUE DATE: October 1, 1992 
Volume 7 • Issue 13 • Pages 1254-1350 



RECEIVED 

OCT s 1992 
LAW LIBRARY 



INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODE 



NORTH CAROLINA REGISTER 



TEMPORARY RULES 



The North Carolina Register is published twice a month and 
contains information relating to agency, executive, legislative and 
judicial actions required by or affecting Chapter 150B of the 
General Statutes. All proposed administrative rules and notices of 
public hearings filed under G.S. 150B-21.2 must be published in 
the Register. The Register will typically comprise approximately 
fifty pages per issue of legal text. 

State law requires that a copy of each issue be provided free of 
charge to each county in the state and to various state officials and 
institutions. 

The North Carolina Register is available by yearly subscription 
at a cost of one hundred and five dollars (S105.00) for 24 issues. 
Individual issues may be purchased for eight dollars (S8.00). 

Requests for subscription to the North Carolina Register should 
be directed to the Office of Administrative Hearings, 
P. 0. Drawer 27447, Raleigh, N. C. 2761 1-7447. 



Under certain emergency conditions, agencies may issue 
temporary rules. Within 24 hours of submission to OAH, the 
Codifier of Rules must review the agency's written statement of 
findings of need for the temporary rule pursuant to the provisions in 
G.S. 150B-21.1. If the Codifier determines that the findings meet 
the criteria in G.S. 150B-21.1, the rule is entered into the NCAC. If 
the Codifier determines that the findings do not meet the criteria, 
the rule is returned to the agency. The agency may supplement its 
findings and resubmit the temporary rule for an additional review 
or the agency may respond that it will remain with its initial 
position. The Codifier, thereafter, will enter the rule into the 
NCAC. A temporary rule becomes effective either when the 
Codifier of Rules enters the rule in the Code or on the sixth 
business day after the agency resubmits the rule without change. 
The temporary rule is in effect for the period specified in the rule or 
180 days, whichever is less. An agency adopting a temporary rule 
must begin rule-making procedures on the permanent rule at the 
same time the temporary rule is filed with the Codifier. 



ADOPTION AMENDMENT, AND REPEAL OF 
RULES 



NORTH CAROLINA ADMINISTRATIVE CODE 



The following is a generalized statement of the procedures to be 
followed for an agency to adopt, amend, or repeal a rule. For the 
specific statutory authority, please consult Article 2A of Chapter 
150B of the General Statutes. 

Any agency intending to adopt, amend, or repeal a rule must 
first publish notice of the proposed action in the North Carolina 
Register. The notice must include the time and place of the public 
hearing (or instructions on how a member of the public may request 
a hearing); a statement of procedure for public comments; the text 
of the proposed rule or the statement of subject matter; the reason 
for the proposed action; a reference to the statutory authority for the 
action and the proposed effective date. 

Unless a specific statute provides otherwise, at least 15 days 
must elapse following publication of the notice in the North 
Carolina Register before the agency may conduct the public 
hearing and at least 30 days must elapse before the agency can take 
action on the proposed rule. An agency may not adopt a rule that 
differs substantially from the proposed form published as part of 
the public notice, until the adopted version has been published in 
the North Carolina Register for an additional 30 day comment 
period. 

When final action is taken, the promulgating agency must file 
the rule with the Rules Review Commission (RRC). After approval 
by RRC, the adopted rule is filed with the Office of Administrative 
Hearings (OAH). 

A rule or amended rule generally becomes effective 5 business 
days after the rule is filed with the Office of Administrative 
Hearings for publication in the North Carolina Administrative Code 
(NCAC). 

Proposed action on rules may be withdrawn by the promulgating 
agency at any time before final action is taken by the agency or 
before filing with OAH for publication in the NCAC. 



The North Carolina Administrative Code (NCAC) is a 
compilation and index of the administrative rules of 25 state 
agencies and 38 occupational licensing boards. The NCAC 
comprises approximately 15,000 letter size, single spaced pages of 
material of which approximately 35% of is changed annually. 
Compilation and publication of the NCAC is mandated by G.S. 
150B-21.18. 

The Code is divided into Titles and Chapters. Each state agency 
is assigned a separate title which is further broken down by 
chapters. Title 21 is designated for occupational licensing boards. 

The NCAC is available in two formats. 

(1) Single pages may be obtained at a minimum cost of 
two dollars and 50 cents (S2.50) for 10 pages or less, 
plus fifteen cents (SO. 15) per each additional page. 

(2) The full publication consists of 53 volumes, totaling in 
excess of 15,000 pages. It is supplemented monthly 
with replacement pages. A one year subscription to the 
full publication including supplements can be 
purchased for seven hundred and fifty dollars 
(S750.00). Individual volumes may also be purchased 
with supplement service. Renewal subscriptions for 
supplements to the initial publication are available. 

Requests for pages of rules or volumes of the NCAC should be 
directed to the Office of Administrative Hearings. 



CITATION TO THE NORTH CAROLINA 
REGISTER 

The North Carolina Register is cited by volume, issue, page 
number and date. 1:1 NCR 101-201, April 1, 1986 refers to 
Volume 1, Issue 1, pages 101 through 201 of the North Carolina 
Register issued on April 1, 1986. 



FOR INFORMATION 


CONTACT 


Office 


of 


Administrative Hearings, 


ATTN: Ru 


es 


Division, 


P.O. 


Drawer 27447, Raleigh, North Carolina 


27611-7447, 


(919) 


733-2678. 











NORTH 
CAROLINA 
REGISTER 




Office of Administrative Hearings 

P. O. Drawer 27447 

Raleigh, North Carolina 27611-7447 

(919) 733-2678 



Julian Mann III, 

Director 
James R. Scarcella Sr., 

Deputy Director 
Molly Masich, 

Director of APA Services 



Staff: 

Ruby Creech, 

Publications Coordinator 
Teresa Kilpatrick, 

Editorial Assistant 
Jean Shirley, 

Editorial Assistant 



ISSUE CONTENTS 



I. GENERAL STATUTES 

Chapter 150B 1254 

II. IN ADDITION 

Final Decision Letter 1275 

III. PROPOSED RULES 
Agriculture 

Pesticide Board 1276 

Environment, Health, and 
Natural Resources 

Wildlife Resources Commission 1299 

Human Resources 

Medical Assistance 1295 

Mental Health, Developmental 
Disabilities and Substance Abuse 
Services 1276 

Licensing Board 
Medical Examiners, Board of . . 1304 

IV. RRC OBJECTIONS 1309 

V. RULES INVALIDATED BY 

JUDICIAL DECISION 1313 

VI. CONTESTED CASE DECISIONS 

Index to ALJ Decisions 1314 

Text of Selected Decisions 

90 EHR 0415 1326 

92 EDC 0023 1333 

VII. CUMULATIVE INDEX 1348 



NORTH CAROLINA REGISTER 

Publication Schedule 

(August 1992 - December 1993) 







Last Day 


Earliest 


Earliest 










for Elec- 


Date for 


Date for 


Last Day 


*Earliest 


Issue 


Last Day 


tronic 


Public 


Adoption 


to Submit 


Effective 


Date 


for Filing 


Filing 


Hearing 


by Agency 


to RRC 


Date 


tikdkzk&iksksk 


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******* 


aje^t^c^e^cjjesjc 


tjc3fc;joje:{o{c3{e 


^< :■< :■< ^c ^« ^e ^ 




08/03/92 


07/13/92 


07/20/92 


08/18/92 


09/02/92 


09/20/92 


11/02/92 


08/14/92 


07/24/92 


07/31/92 


08/29/92 


09/13/92 


09/20/92 


11/02/92 


09/01/92 


08/11/92 


08/18/92 


09/16/92 


10/01/92 


10/20/92 


12/01/92 


09/15/92 


08/25/92 


09/01/92 


09/30/92 


10/15/92 


10/20/92 


12/01/92 


10/01/92 


09/10/92 


09/17/92 


10/16/92 


10/31/92 


11/20/92 


01/04/93 


10/15/92 


09/24/92 


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10/30/92 


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06/01/93 


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06/17/93 


07/16/93 


07/31/93 


08/20/93 


10/01/93 


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03/01/94 



* Tlie "Earliest Effective Date" is computed assuming that the agency 
follows the publication schedule above, that the Rules Review Commission approves 
the rule at the next calendar month meeting after submission, and that RRC delivers 
the rule to the Codifier of Rules five (5) business days before the 1st business day of 
the next calendar month. 



GENERAL STATUTES OF NORTH CAROLINA 



CHAPTER 150B 



THE ADMINISTRATIVE PROCEDURE ACT 



[The following excerpt contains the statutory provisions of the Administrative Procedure Act as amended by 
the 1991 General Assembly, Second Session effective July 1, 1992.] 



Article 1. 
General Provisions. 
§ 150B-1. Policy and scope. 

(a) Purpose. -- This Chapter establishes a uni- 
form system of administrative rule making and 
adjudicatory procedures for agencies. The proce- 
dures ensure that the functions of rule making, 
investigation, advocacy, and adjudication are not 
all performed by the same person in the adminis- 
trative process. 

(b) Rights. — This Chapter confers procedural 
rights. 

(c) Full Exemptions. — This Chapter applies to 
every agency except: 

(1) The North Carolina National Guard in 
exercising its court-martial jurisdiction. 

(2) The Department of Human Resources 
in exercising its authority over the 
Camp Butner reservation granted in 
Article 6 of Chapter 122C of the Gen- 
eral Statutes. 

(3) The Utilities Commission. 

(4) The Industrial Commission. 

(5) The Employment Security Commission. 

(d) Exemptions From Rule Making. — Article 
2A of this Chapter does not apply to the following: 

(1) The Commission. 

(2) The North Carolina Low-Level Radio- 
active Waste Management Authority in 
administering the provisions of G.S. 
104G-10and G.S. 104G-11. 

(3) The North Carolina Hazardous Waste 
Management Commission in administer- 
ing the provisions of G.S. 130B-13 and 
G.S. 130B-14. 

(4) The Department of Revenue, except 
that Parts 3 and 4 of Article 2A apply 
to the Department. 

(5) The North Carolina Air Cargo Airport 
Authority with respect to the acquisi- 
tion, construction, operation, or use, 
including fees or charges, of any por- 
tion of a cargo airport complex. 

(e) Exemptions From Contested Case Provi- 
sions. -- The contested case provisions of this 
Chapter apply to all agencies and all proceedings 
not expressly exempted from the Chapter. The 



contested case provisions of this Chapter do not 
apply to the following: 

(1) The Department of Human Resources 
and the Department of Environment, 
Health, and Natural Resources in com- 
plying with the procedural safeguards 
mandated by Section 680 of Part H of 
Public Law 99-457 as amended (Educa- 
tion of the Handicapped Act Amend- 
ments of 1986). 

(2) The Governor's Waste Management 
Board in administering the provisions of 
G.S. 104E-6.2and G.S. 130A-293. 

(3) The North Carolina Low-Level Radio- 
active Waste Management Authority in 
administering the provisions of G.S. 
104G-9, 104G-10, and 104G-11. 

(4) The North Carolina Hazardous Waste 
Management Commission in administer- 
ing the provisions of G.S. 130B-11, 
130B-13, and BOB- 14. 

(5) Hearings required pursuant to the Reha- 
bilitation Act of 1973, (Public Law 
93-122), as amended and federal regu- 
lations promulgated thereunder. G.S. 
150B-51(a) is considered a contested 
case hearing provision that does not 
apply to these hearings. 

(6) The Department of Revenue. 

(7) The Department of Correction. 

(8) The Department of Transportation, 
except as provided in G.S. 136-29. 

(9) The Occupational Safety and Health 
Review Board in all actions that do not 
involve agricultural employers. 

(10) The North Carolina Air Cargo Airport 
Authority with respect to the acquisi- 
tion, construction, operation, or use, 
including fees or charges, of any por- 
tion of a cargo airport complex. 

(f) Exemption From All But Judicial Review. — 
No Article in this Chapter except Article 4 applies 
to the University of North Carolina. 
§ 150B-2. Definitions. — As used in this 

Chapter, 

(01) 'Administrative law judge" means a 
person appointed under G.S. 7A-752, 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1254 



GENERAL STATUTES OF NORTH CAROLINA 



7A-753, or 7A-757. 

(1) "Agency" means an agency or an offi- 
cer in the executive branch of the gov- 
ernment of this State and includes the 
Council of State, the Governor's Of- 
fice, a board, a commission, a depart- 
ment, a division, a council, and any 
other unit of government in the execu- 
tive branch. A local unit of govern- 
ment is not an agency. 

(la) "Adopt" means to take final action to 
create, amend, or repeal a rule. 

(lb) "Codifier of Rules" means the Chief 
Administrative Law Judge of the Office 
of Administrative Hearings or a desig- 
nated representative of the Chief Ad- 
ministrative Law Judge. 

(lc) "Commission" means the Rules Review 
Commission. 

(2) "Contested case" means an administra- 
tive proceeding pursuant to this Chapter 
to resolve a dispute between an agency 
and another person that involves the 
person's rights, duties, or privileges, 
including licensing or the levy of a 
monetary penalty. "Contested case" 
does not include rulemaking, declarato- 
ry rulings, or the award or denial of a 
scholarship or grant. 

(2a) Repealed. 

(2b) "Hearing officer" means a person or 
group of persons designated by an 
agency that is subject to Article 3A of 
this Chapter to preside in a contested 
case hearing conducted under that Arti- 
cle. 

(3) "License" means any certificate, permit 
or other evidence, by whatever name 
called, of a right or privilege to engage 
in any activity, except licenses issued 
under Chapter 20 and Subchapter I of 
Chapter 105 of the General Statutes and 
occupational licenses. 

(4) "Licensing" means any administrative 
action issuing, failing to issue, suspend- 
ing, or revoking a license or occupa- 
tional license. "Licensing" does not 
include controversies over whether an 
examination was fair or whether the 
applicant passed the examination. 

(4a) Occupational license" means any certifi- 
cate, permit, or other evidence, by 
whatever name called, of a right or 
privilege to engage in a profession, 
occupation, or field of endeavor that is 



issued by an occupational licensing 
agency. 
(4b) "Occupational licensing agency" means 
any board, commission, committee or 
other agency of the State of North 
Carolina which is established for the 
primary purpose of regulating the entry 
of persons into, and/or the conduct of 
persons within a particular profession, 
occupation or field of endeavor, and 
which is authorized to issue and revoke 
licenses. "Occupational licensing agen- 
cy" does not include State agencies or 
departments which may as only a part 
of their regular function issue permits 
or licenses. 

(5) "Party" means any person or agency 
named or admitted as a party or proper- 
ly seeking as of right to be admitted as 
a party and includes the agency as 
appropriate. This subdivision does not 
permit an agency that makes a final 
decision, or an officer or employee of 
the agency, to petition for initial judi- 
cial review of that decision. 

(6) "Person aggrieved" means any person 
or group of persons of common interest 
directly or indirectly affected substan- 
tially in his or its person, property, or 
employment by an administrative deci- 
sion. 

(7) "Person" means any natural person, 
partnership, corporation, body politic 
and any unincorporated association, 
organization, or society which may sue 
or be sued under a common name. 

(8) "Residence" means domicile or princi- 
pal place of business. 

(8a) "Rule" means any agency regulation, 
standard, or statement of general appli- 
cability that implements or interprets an 
enactment of the General Assembly or 
Congress or a regulation adopted by a 
federal agency or that describes the 
procedure or practice requirements of 
an agency. The term includes the 
establishment of a fee and the amend- 
ment or repeal of a prior rule. The 
term does not include the following: 
a. Statements concerning only the 
internal management of an agency 
or group of agencies within the 
same principal office or depart- 
ment enumerated in G.S. 143-11 
or 143B-6, including policies and 



1255 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



GENERAL STATUTES OF NORTH CAROLINA 



procedures manuals, if the state- 
ment does not directly or substan- 
tially affect the procedural or 
substantive rights or duties of a 
person not employed by the agen- 
cy or group of agencies. 

b. Budgets and budget policies and 
procedures issued by the Director 
of the Budget, by the head of a 
department, as defined by G.S. 
143A-2 or G.S. 143B-3, by an 
occupational licensing board, as 
defined by G.S. 93B-1, or by the 
State Board of Elections. 

c. Nonbinding interpretive state- 
ments within the delegated author- 
ity of an agency that merely 
define, interpret, or explain the 
meaning of a statute or rule. 

d. A form, the contents or substan- 
tive requirements of which are 
prescribed by rule or statute. 

e. Statements of agency policy made 
in the context of another proceed- 
ing, including: 

1 . Declaratory rulings under G.S. 
150B-4. 

2. Orders establishing or fixing 
rates or tariffs. 

f. Requirements, communicated to 
the public by the use of signs or 
symbols, concerning the use of 
public roads, bridges, ferries, 
buildings, or facilities. 

g. Statements that set forth criteria 
or guidelines to be used by the 
staff of an agency in performing 
audits, investigations, or inspec- 
tions; in settling financial disputes 
or negotiating financial arrange- 
ments; or in the defense, prosecu- 
tion, or settlement of cases. 

h. Scientific, architectural, or engi- 
neering standards, forms, or 
procedures, including design 
criteria and construction standards 
used to construct or maintain 
highways, bridges, or ferries. 

i. Job classification standards, job 
qualifications, and salaries estab- 
lished for positions under the 
jurisdiction of the State Personnel 
Commission. 

j. Establishment of the interest rate 

that applies to tax assessments 



under G.S. 105-241.1 and the 
variable component of the excise 
tax on motor fuel under G.S. 
105-434. 
(8b) "Substantial evidence" means relevant 
evidence a reasonable mind might 
accept as adequate to support a con- 
clusion. 
(9) Repealed. 
§ 150B-3. Special provisions on licensing. 

(a) When an applicant or a licensee makes a 
timely and sufficient application for issuance or 
renewal of a license or occupational license, 
including the payment of any required license fee, 
the existing license or occupational license does 
not expire until a decision on the application is 
finally made by the agency, and if the application 
is denied or the terms of the new license or occu- 
pational license are limited, until the last day for 
applying for judicial review of the agency order. 
This subsection does not affect agency action 
summarily suspending a license or occupational 
license under subsections (b) and (c) of this sec- 
tion. 

(b) Before the commencement of proceedings 
for the suspension, revocation, annulment, with- 
drawal, recall, cancellation, or amendment of any 
license other than an occupational license, the 
agency shall give notice to the licensee, pursuant 
to the provisions of G.S. 150B-23. Before the 
commencement of such proceedings involving an 
occupational license, the agency shall give notice 
pursuant to the provisions of G.S. 150B-38. In 
either case, the licensee shall be given an opportu- 
nity to show compliance with all lawful require- 
ments for retention of the license or occupational 
license. 

(c) If the agency finds that the public health, 
safety, or welfare requires emergency action and 
incorporates this finding in its order, summary 
suspension of a license or occupational license may 
be ordered effective on the date specified in the 
order or on service of the certified copy of the 
order at the last known address of the licensee, 
whichever is later, and effective during the pro- 
ceedings. The proceedings shall be promptly 
commenced and determined. 

Nothing in this subsection shall be construed as 
amending or repealing any special statutes, in 
effect prior to February 1, 1976, which provide 
for the summary suspension of a license. 
§ 150B-4. Declaratory rulings. 

(a) On request of a person aggrieved, an agency 
shall issue a declaratory ruling as to the validity of 
a rule or as to the applicability to a given state of 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1256 



GENERAL STATUTES OF NORTH CAROLINA 



facts of a statute administered by the agency or of 
a rule or order of the agency, except when the 
agency for good cause finds issuance of a ruling 
undesirable. The agency shall prescribe in its 
rules the circumstances in which rulings shall or 
shall not be issued. A declaratory ruling is bind- 
ing on the agency and the person requesting it 
unless it is altered or set aside by the court. An 
agency may not retroactively change a declaratory 
ruling, but nothing in this section prevents an 
agency from prospectively changing a declaratory 
ruling. A declaratory ruling is subject to judicial 
review in the same manner as an order in a con- 
tested case. Failure of the agency to issue a 
declaratory ruling on the merits within 60 days of 
the request for such ruling shall constitute a denial 
of the request as well as a denial of the merits of 
the request and shall be subject to judicial review, 
(b) This section does not apply to the Depart- 
ment of Correction. 

Article 2. 
Rule Making. 

Repealed. 

Article 2A. 
Rules. 
Part 1. General Provisions. 
§ 150B-18. Scope and effect. 

This Article applies to an agency's exercise of its 
authority to adopt a rule. A rule is not valid 
unless it is adopted in substantial compliance with 
this Article. 

§ 150B-19. Restrictions on what can be adopt- 
ed as a rule. 

An agency may not adopt a rule that does one or 
more of the following: 

(1) Implements or interprets a law unless 
that law or another law specifically 
authorizes the agency to do so. 

(2) Enlarges the scope of a profession, 
occupation, or field of endeavor for 
which an occupational license is re- 
quired. 

(3) Imposes criminal liability or a civil 
penalty for an act or omission, includ- 
ing the violation of a rule, unless a law 
specifically authorizes the agency to do 
so or a law declares that violation of 
the rule is a criminal offense or is 
grounds for a civil penalty. 

(4) Repeats the content of a law, a rule, or 
a federal regulation. 

(5) Establishes a reasonable fee or other 
reasonable charge for providing a ser- 
vice in fulfillment of a duty unless a 



law specifically authorizes the agency 
to do so or the fee or other charge is 
for one of the following: 

a. A service to a State, federal, or local 
governmental unit. 

b. A copy of part or all of a State publi- 
cation or other document, the cost of 
mailing a document, or both. 

c. A transcript of a public hearing. 

d. A conference, workshop, or course. 

e. Data processing services. 

(6) Allows the agency to waive or modify 
a requirement set in a rule unless a rule 
establishes specific guidelines the agen- 
cy must follow in determining whether 
to waive or modify the requirement. 

§ 150B-20. Petitioning an agency to adopt a 

rule. 

(a) Petition. -- A person may petition an agency 
to adopt a rule by submitting to the agency a 
written rule-making petition requesting the adop- 
tion. A person may submit written comments with 
a rule-making petition. If a rule-making petition 
requests the agency to create or amend a rule, the 
person must submit the proposed text of the 
requested rule change and a statement of the effect 
of the requested rule change. Each agency must 
establish by rule the procedure for submitting a 
rule-making petition to it and the procedure the 
agency follows in considering a rule-making 
petition. 

(b) Time. — An agency must grant or deny a 
rule-making petition submitted to it within 30 days 
after the date the rule-making petition is submitted, 
unless the agency is a board or commission. If the 
agency is a board or commission, it must grant or 
deny a rule-making petition within 120 days after 
the date the rule-making petition is submitted. 

(c) Action. — If an agency denies a rule-making 
petition, it must send the person who submitted the 
petition a written statement of the reasons for 
denying the petition. If an agency grants a 
rule-making petition, it must inform the person 
who submitted the rule-making petition of its 
decision and must initiate rule-making proceedings. 
When an agency grants a rule-making petition 
requesting the creation or amendment of a rule, the 
notice of rule making it publishes in the North 
Carolina Register may state that the agency is 
initiating rule-making proceedings as the result of 
a rule-making petition, state the name of the 
person who submitted the rule-making petition, set 
out the text of the requested rule change submitted 
with the rule-making petition, and state whether 
the agency endorses the proposed rule change. 



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GENERAL STATUTES OF NORTH CAROLINA 



(d) Review. — Denial of a rule-making petition 
is a final agency decision and is subject to judicial 
review under Article 4 of this Chapter. Failure of 
an agency to grant or deny a rule-making petition 
within the time limits set in subsection (b) is a 
denial of the rule-making petition. 

(e) Exception. — This section does not apply to 
the Department of Correction. 

§ 150B-21. Agency must designate 

rule-making coordinator. 

Each agency must designate one or more 
rule-making coordinators to oversee the agency's 
rule-making functions. The coordinator must 
prepare notices of public hearings, coordinate 
access to the agency's rules, and serve as the 
liaison between the agency, other agencies, and the 
public in the rule-making process. 

Part 2. Adoption of Rules. 
§ 150B-21.1. Procedure for adopting a tem- 
porary rule. 

(a) Adoption. — An agency may adopt a tempo- 
rary rule without prior notice or hearing or upon 
any abbreviated notice or hearing the agency finds 
practical when it finds that adherence to the notice 
and hearing requirements of this Part would be 
contrary to the public interest and that the immedi- 
ate adoption of the rule is required by one or more 
of the following: 

(1) A serious and unforeseen threat to the 
public health, safety, or welfare. 

(2) The effective date of a recent act of the 
General Assembly or the United States 
Congress. 

(3) A recent change in federal or State 
budgetary policy. 

(4) A federal regulation. 

(5) A court order. 

(6) The need for the rule to become effec- 
tive the same date as the State Medical 
Facilities Plan approved by the Gover- 
nor, if the rule addresses a matter 
included in the State Medical Facilities 
Plan. 

An agency must prepare a written statement of 
its findings of need for a temporary rule. The 
statement must be signed by the head of the agen- 
cy adopting the rule. 

An agency must begin rule-making proceedings 
for a permanent rule by the day it adopts a tempo- 
rary rule. An agency begins rule-making proceed- 
ings for a permanent rule by submitting to the 
codifier written notice of its intent to adopt a 
permanent rule. 

(b) Review. — When an agency adopts a tempo- 
rary rule it must submit the rule, the agency's 



written statement of its findings of need for the 
rule, and the notice of intent to adopt a permanent 
rule to the Codifier of Rules. Within one business 
day after an agency submits a temporary rule, the 
Codifier of Rules must review the agency's written 
statement of findings of need for the rule to deter- 
mine whether the statement of need meets the 
criteria listed in subsection (a). In reviewing the 
statement, the Codifier of Rules may consider any 
information submitted by the agency or another 
person. If the Codifier of Rules finds that the 
statement meets the criteria, the Codifier of Rules 
must notify the head of the agency and enter the 
rule in the North Carolina Administrative Code. 

If the Codifier of Rules finds that the statement 
does not meet the criteria, the Codifier of Rules 
must immediately notify the head of the agency. 
The agency may supplement its statement of need 
with additional findings or submit a new statement. 
If the agency provides additional findings or 
submits a new statement, the Codifier of Rules 
must review the additional findings or new state- 
ment within one business day after the agency 
submits the additional findings or new statement. 
If the Codifier of Rules again finds that the state- 
ment does not meet the criteria listed in subsection 
(a), the Codifier of Rules must immediately notify 
the head of the agency. 

If an agency decides not to provide additional 
findings or submit a new statement when notified 
by the Codifier of Rules that the agency's findings 
of need for a rule do not meet the required crite- 
ria, the agency must notify the Codifier of Rules 
of its decision. The Codifier of Rules must then 
enter the rule in the North Carolina Administrative 
Code on the sixth business day after receiving 
notice of the agency's decision. 

(c) Standing. — A person aggrieved by a tempo- 
rary rule adopted by an agency may file an action 
for declaratory judgment in Wake County Superior 
Court pursuant to Article 26 of Chapter 1 of the 
General Statutes. In the action, the court shall 
determine whether the agency's written statement 
of findings of need for the rule meets the criteria 
listed in subsection (a) and whether the rule meets 
the standards in G.S. 150B-21.9 that apply to 
review of a permanent rule. The court may not 
grant an ex parte temporary restraining order. 

Filing a petition for rule making or a request for 
a declaratory ruling with the agency that adopted 
the rule is not a prerequisite to filing an action 
under this subsection. A person who files an 
action for declaratory judgment under this subsec- 
tion must serve a copy of the complaint on the 
agency that adopted the rule being contested, the 



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1258 



GENERAL STATUTES OF NORTH CAROLINA 



Codifier of Rules, and the Commission. 

(d) Effective Date and Expiration. — A tempo- 
rary rule becomes effective on the date specified in 
G.S. 150B-21.3. A temporary rule expires on the 
date specified in the rule or 180 days from the date 
the rule becomes effective, whichever comes first. 
§ 150B-21.2. Procedure for adopting a per- 
manent rule. 

(a) Notice. -- Before an agency adopts a perma- 
nent rule, it must publish notice of its intent to 
adopt a permanent rule in the North Carolina 
Register and as required by any other law. The 
notice published in the North Carolina Register 
must include all of the following: 

(1) Either the text of the proposed rule or 
a statement of the subject matter of the 
proposed rule making. 

(2) A short explanation of the reason for 
the proposed action. 

(3) A citation to the law that gives the 
agency the authority to adopt the pro- 
posed rule, if the notice includes the 
text of the proposed rule, or a citation 
to the law that gives the agency the 
authority to adopt a rule on the subject 
matter of the proposed rule making, if 
the notice includes only a statement of 
the subject matter of the proposed rule 
making. 

(4) The proposed effective date of the 
proposed rule, if the notice includes the 
text of the proposed rule, or the pro- 
posed effective date of a rule adopted 
on the subject matter of the proposed 
rule making, if the notice includes only 
a statement of the subject matter of the 
proposed rule making. 

(5) The date, time, and place of any public 
hearing scheduled on the proposed rule 
or subject matter of the proposed rule 
making. 

(6) Instructions on how a person may 
demand a public hearing on a proposed 
rule if the notice does not schedule a 
public hearing on the proposed rule and 
subsection (c) requires the agency to 
hold a public hearing on the proposed 
rule when requested to do so. 

(7) The period of time during which and 
the person to whom written comments 
may be submitted on the proposed rule 
or subject matter of the proposed rule 
making. 

(8) If a fiscal note has been prepared for 
the proposed rule or will be prepared 



when a rule is proposed on the subject 

matter of the proposed rule making, a 

statement that a copy of the fiscal note 

can be obtained from the agency. 

(b) Mailing List. -- An agency must maintain a 

mailing list of persons who have requested notice 

of rule making. When an agency publishes a 

rule-making notice in the North Carolina Register, 

it must mail a copy of the notice to each person on 

the mailing list who has requested notice of 

rule-making proceedings on the rule or the subject 

matter for rule making described in the notice. An 

agency may charge an annual fee to each person 

on the agency's mailing list to cover copying and 

mailing costs. 

(c) Hearing. — An agency must hold a public 
hearing on a rule it proposes to adopt in two 
circumstances and may hold a public hearing in 
other circumstances. When an agency is required 
to hold a public hearing on a proposed rule or 
decides to hold a public hearing on a proposed rule 
when it is not required to do so, the agency must 
publish in the North Carolina Register a notice of 
the date, time, and place of the public hearing. 
The hearing date of a public hearing held after the 
agency publishes notice of the hearing in the North 
Carolina Register must be at least 15 days after the 
date the notice is published. 

An agency must hold a public hearing on a rule 
it proposes to adopt in the following two circum- 
stances: 

(1 ) The agency publishes a statement of the 
subject matter of the proposed rule 
making in the notice in the North Caro- 
lina Register. 

(2) The agency publishes the text of the 
proposed rule in the notice in the North 
Carolina Register and all the following 
apply: 

a. The notice does not schedule a public 
hearing on the proposed rule. 

b. Within 15 days after the notice is 
published, the agency receives a 
written request for a public hearing on 
the proposed rule. 

c. The proposed rule is not part of a 
rule-making proceeding the agency 
initiated by publishing a statement of 
the subject matter of proposed rule 
making. 

d. The proposed text is not a changed 
version of proposed text the agency 
previously published in the course of 
rule-making proceedings but did not 
adopt. 



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GENERAL STATUTES OF NORTH CAROLINA 



(d) Text After Subject-Matter Notice. — When 
an agency publishes notice of the subject matter of 
proposed rule making in the North Carolina 
Register, it must subsequently publish in the North 
Carolina Register the text of the rule it proposes to 
adopt as a result of the public hearing and of any 
comments received on the subject matter. An 
agency may not publish the proposed text of a rule 
for which it published a subject-matter notice 
before the public hearing on the subject matter. 

(e) Comments. -- An agency must accept com- 
ments on the text of a proposed rule published in 
the North Carolina Register for at least 30 days 
after the text is published or until the date of any 
public hearing held on the proposed rule, whichev- 
er is longer. An agency must accept comments on 
a statement of the subject matter of proposed rule 
making until the public hearing on the subject 
matter. An agency must consider fully all written 
and oral comments received. 

(f) Adoption. — An agency may not adopt a rule 
until the time for commenting on the proposed text 
of the rule has elapsed and may not adopt a rule if 
more than 12 months have elapsed since the end of 
the time for commenting on the proposed text of 
the rule. An agency may not adopt a rule that 
differs substantially from the text of a proposed 
rule published in the North Carolina Register 
unless the agency publishes the text of the pro- 
posed different rule in the North Carolina Register 
and accepts comments on the proposed different 
rule for the time set in subsection (e). 

An adopted rule differs substantially from a 
proposed rule if it does one or more of the follow- 
ing: 

(1) Affects the interests of persons who, 
based on the notice published in the 
North Carolina Register or the pro- 
posed text of the rule, could not reason- 
ably have determined that the rule 
would affect their interests. 

(2) Addresses a subject matter or an issue 
that is not addressed in the proposed 
text of the rule. 

(3) Produces an effect that could not rea- 
sonably have been expected based on 
the proposed text of the rule. 

When an agency adopts a rule, it may not take 
subsequent action on the rule without following the 
procedures in this Part. 

(g) Explanation. — An agency must issue a 
concise written statement explaining why the 
agency adopted a rule if, within 30 days after the 
agency adopts the rule, a person asks the agency to 
do so. The explanation must state the principal 



reasons for and against adopting the rule and must 
discuss why the agency rejected any arguments 
made or considerations urged against the adoption 
of the rule. 

(h) Record. — An agency must keep a record of 
a rule-making proceeding. The record must 
include all written comments received, a transcript 
or recording of any public hearing held on the 
rule, and any written explanation made by the 
agency for adopting the rule. 
§ 150B-21.3. Effective date of rules. 

(a) Temporary Rule. — A temporary rule be- 
comes effective on the date the Codifier of Rules 
enters the rule in the North Carolina Administra- 
tive Code. 

(b) Permanent Rule. - A permanent rule ap- 
proved by the Commission becomes effective five 
business days after the Commission delivers the 
rule to the Codifier of Rules, unless the agency 
adopting the rule specifies a later effective date. 
If the agency specifies a later effective date, the 
rule becomes effective on that date. 

A permanent rule that is not approved by the 
Commission becomes effective five business days 
after the agency adopting the rule delivers the rule 
to the Codifier of Rules, unless the agency adopt- 
ing the rule specifies a later effective date. If the 
agency specifies a later effective date, the rule 
becomes effective on that date. 

(c) OSHA Standard. — A permanent rule con- 
cerning an occupational safety and health standard 
that is adopted by the Occupational Safety and 
Health Division of the Department of Labor and is 
identical to a federal regulation promulgated by the 
Secretary of the United States Department of 
Labor becomes effective on the date the Division 
delivers the rule to the Codifier of Rules, unless 
the Division specifies a later effective date. If the 
Division specifies a later effective date, the rule 
becomes effective on that date. 

§ 150B-21.4. Fiscal notes on rules. 

(a) State Funds. — Before an agency publishes in 
the North Carolina Register the proposed text of a 
permanent rule change that would require the 
expenditure or distribution of funds subject to the 
Executive Budget Act, Article 1 of Chapter 143, it 
must submit the text of the proposed rule change 
and a fiscal note on the proposed rule change to 
the Director of the Budget and obtain certification 
from the Director that the funds that would be 
required by the proposed rule change are available. 
The fiscal note must state the amount of funds that 
would be expended or distributed as a result of the 
proposed rule change and explain how the amount 
was computed. The Director of the Budget must 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1260 



GENERAL STATUTES OF NORTH CAROLINA 



certify a proposed rule change if funds are avail- 
able to cover the expenditure or distribution 
required by the proposed rule change. 

(b) Local Funds. — Before an agency publishes 
in the North Carolina Register the proposed text of 
a permanent rule change that would affect the 
expenditures or revenues of a unit of local govern- 
ment, it must submit the text of the proposed rule 
change and a fiscal note on the proposed rule 
change to the Fiscal Research Division of the 
General Assembly, the Office of State Budget and 
Management, the North Carolina Association of 
County Commissioners, and the North Carolina 
League of Municipalities. The fiscal note must 
state the amount by which the proposed rule 
change would increase or decrease expenditures or 
revenues of a unit of local government and must 
explain how the amount was computed. 

(c) Errors. — An erroneous fiscal note prepared 
in good faith does not affect the validity of a rule. 
§ 150B-21.5. Circumstances when notice and 
rule-making hearing not required. 

(a) Amendment. — An agency is not required to 
publish a notice of rule making in the North 
Carolina Register or hold a public hearing when it 
proposes to amend a rule, without changing the 
substance of the rule, to do one of the following: 

( 1 ) Reletter or renumber the rule or 
subparts of the rule. 

(2) Substitute one name for another when 
an organization or position is renamed. 

(3) Correct a citation in the rule to another 
rule or law when the citation has be- 
come inaccurate since the rule was 
adopted because of the repeal or renum- 
bering of the cited rule or law. 

(4) Change information that is readily 
available to the public, such as an 
address or a telephone number. 

(5) Correct a typographical error made in 
entering the rule in the North Carolina 
Administrative Code. 

(6) Change a rule in response to a request 
or an objection by the Commission. 

(b) Repeal. — An agency is not required to 
publish a notice of rule making in the North 
Carolina Register or hold a public hearing when it 
proposes to repeal a rule as a result of any of the 
following: 

( 1 ) The law under which the rule was 
adopted is repealed. 

(2) The law under which the rule was 
adopted or the rule itself is declared 
unconstitutional. 

(3) The rule is declared to be in excess of 



the agency's statutory authority. 

(c) OSHA Standard. — The Occupational Safety 
and Health Division of the Department of Labor is 
not required to publish a notice of rule making in 
the North Carolina Register or hold a public 
hearing when it proposes to adopt a rule that 
concerns an occupational safety and health stan- 
dard and is identical to a federal regulation pro- 
mulgated by the Secretary of the United States 
Department of Labor. The Occupational Safety 
and Health Division is not required to submit to 
the Commission for review a rule for which notice 
and hearing is not required under this subsection. 
§ 150B-21.6. Incorporating material in a rule 
by reference. 

An agency may incorporate the following materi- 
al by reference in a rule without repeating the text 
of the referenced material: 

(1) Another rule or part of a rule adopted by 
the agency. 

(2) All or part of a code, standard, or regula- 
tion adopted by another agency, the 
federal government, or a generally recog- 
nized organization or association. 

(3) Material adopted to meet a requirement 
of the federal government. 

In incorporating material by reference, the 
agency must designate in the rule whether or not 
the incorporation includes subsequent amendments 
and editions of the referenced material. The 
agency can change this designation only by a 
subsequent rule-making proceeding. The agency 
must have copies of the incorporated material 
available for inspection and must specify in the 
rule both where copies of the material can be 
obtained and the cost on the date the rule is adopt- 
ed of a copy of the material. 

A statement in a rule that a rule incorporates 
material by reference in accordance with former 
G.S. 150B- 14(b) is a statement that the rule does 
not include subsequent amendments and editions of 
the referenced material. A statement in a rule that 
a rule incorporates material by reference in accor- 
dance with former G.S. 150B-14(c) is a statement 
that the rule includes subsequent amendments and 
editions of the referenced material. 
§ 150B-21.7. Effect of transfer of duties or 
termination of agency on rules. 

When a law that authorizes an agency to adopt a 
rule is repealed and another law gives the same or 
another agency substantially the same authority to 
adopt a rule, the rule remains in effect until the 
agency amends or repeals the rule. When a law 
that authorizes an agency to adopt a rule is re- 
pealed and another law does not give the same or 



( 



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GENERAL STATUTES OF NORTH CAROLINA 



another agency substantially the same authority to 
adopt a rule, a rule adopted under the repealed law 
is repealed as of the date the law is repealed. 

When an executive order abolishes part or all of 
an agency and transfers a function of that agency 
to another agency, a rule concerning the trans- 
ferred function remains in effect until the agency 
to which the function is transferred amends or 
repeals the rule. When an executive order abolish- 
es part or all of an agency and does not transfer a 
function of that agency to another agency, a rule 
concerning a function abolished by the executive 
order is repealed as of the effective date of the 
executive order. 

The Director of Fiscal Research of the General 
Assembly must notify the Codifier of Rules when 
a rule is repealed under this section. When noti- 
fied of a rule repealed under this section, the 
Codifier of Rules must enter the repeal of the rule 
in the North Carolina Administrative Code. 

Part 3. Review by Commission. 
§ 150B-21.8. Review of rule by Commission. 

(a) Temporary Rule. — The Commission does 
not review a temporary rule. 

(b) Permanent Rule. — An agency must submit 
a permanent rule adopted by it to the Commission 
before the rule can be included in the North 
Carolina Administrative Code. The Commission 
reviews a permanent rule in accordance with the 
standards in G.S. 150B-21.9 and follows the 
procedure in this Part in its review of a permanent 
rule. 

(c) Scope. — When the Commission reviews an 
amendment to a rule, it may review the entire rule 
that is being amended. The procedure in G.S. 
1 50B-2 1.12 applies when the Commission objects 
to a part of a rule that is within its scope of review 
but is not changed by a rule amendment. 

§ 150B-21.9. Standards and timetable for 
review by Commission. 

(a) Standards. -- The Commission must deter- 
mine whether a rule meets all of the following 
criteria: 

(1) It is within the authority delegated to 
the agency by the General Assembly. 

(2) It is clear and unambiguous. 

(3) It is reasonably necessary to fulfill a 
duty delegated to the agency by the 
General Assembly. 

The Commission may determine if a rule submit- 
ted to it was adopted in accordance with Part 2 of 
this Article. The Commission must notify the 
agency that adopted the rule if it determines that a 
rule was not adopted in accordance with Part 2 of 
this Article and must return the rule to the agency. 



Entry of a rule in the North Carolina Administra- 
tive Code after review by the Commission is 
conclusive evidence that the rule was adopted in 
accordance with Part 2 of this Article. 

(b) Timetable. — The Commission must review 
a rule submitted to it on or before the twentieth of 
a month by the last day of the next month. The 
Commission must review a rule submitted to it 
after the twentieth of a month by the last day of 
the second subsequent month. 
§ 150B-21.10. Commission action on perma- 
nent rule. 

At the first meeting at which a permanent rule is 
before the Commission for review, the Commis- 
sion must take one of the following actions: 

(1) Approve the rule, if the Commission 
determines that the rule meets the stan- 
dards for review. 

(2) Object to the rule, if the Commission 
determines that the rule does not meet the 
standards for review. 

(3) Extend the period for reviewing the rule, 
if the Commission determines it needs 
additional information on the rule to be 
able to decide whether the rule meets the 
standards for review. 

In reviewing a new rule or an amendment to an 
existing rule, the Commission may request an 
agency to make technical changes to the rule and 
may condition its approval of the rule on the 
agency's making the requested technical changes. 
§ 150B-21.il. Procedure when Commission 
approves permanent rule. 

When the Commission approves a permanent 
rule, it must notify the agency that adopted the 
rule of the Commission's approval and must 
deliver the approved rule to the Codifier of Rules. 
The Commission must deliver an approved rule by 
the end of the month in which the Commission 
approved the rule, unless the agency asks the 
Commission to delay the delivery of the rule. 
§ 150B-21.12. Procedure when Commission 
objects to a permanent rule. 

(a) Action. -- When the Commission objects to 
a permanent rule, it must send the agency that 
adopted the rule a written statement of the objec- 
tion and the reason for the objection. The agency 
that adopted the rule must take one of the follow- 
ing actions: 

(1) Change the rule to satisfy the 
Commission's objection and submit the 
revised rule to the Commission. 

(2) Submit a written response to the Com- 
mission indicating that the agency has 
decided not to change the rule. 



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GENERAL STATUTES OF NORTH CAROLINA 



An agency that is not a board or commission 
must take one of these actions within 30 days after 
receiving the Commission's statement of objection. 
A board or commission must take one of these 
actions within 30 days after receiving the 
Commission's statement of objection or within 10 
days after the board or commission's next regular- 
ly scheduled meeting, whichever comes later. 

When an agency changes a rule in response to an 
objection by the Commission, the Commission 
must determine whether the change satisfies the 
Commission's objection. If it does, the Commis- 
sion must approve the rule. If it does not, the 
Commission must send the agency a written 
statement of the Commission's continued objection 
and the reason for the continued objection. 

A rule to which the Commission has objected 
remains under review by the Commission until the 
agency that adopted the rule decides not to satisfy 
the Commission's objection and makes a written 
request to the Commission to return the rule to the 
agency. When the Commission returns a rule to 
which it has objected, it may send to the President 
of the Senate and each member of the General 
Assembly a report of its objection to the rule. 

(b) Entry in Code. -- When the Commission 
returns a rule to which it has objected to the 
agency that adopted the rule, the Commission must 
notify the Codifier of Rules of its action and of the 
basis of the Commission's objection. An agency 
whose rule is returned may file the rule with the 
Codifier of Rules. When the Codifier of Rules 
enters in the North Carolina Administrative Code 
a rule to which the Commission objected, the entry 
must reflect the Commission's objection and must 
state the standard on which the Commission based 
its objection. 

§ 150B-21.13. Procedure when Commission 
extends period for review of permanent rule. 

When the Commission extends the period for 
review of a permanent rule, it must notify the 
agency that adopted the rule of the extension and 
the reason for the extension. After the Commis- 
sion extends the period for review of a rule, it may 
call a public hearing on the rule. Within 70 days 
after extending the period for review of a rule, the 
Commission must decide whether to approve the 
rule, object to the rule, or call a public hearing on 
the rule. 
§ 150B-21.14. Public hearing on a rule. 

The Commission may call a public hearing on a 
rule when it extends the period for review of the 
rule. At the request of an agency, the Commission 
may call a public hearing on a rule that is not 
before it for review. Calling a public hearing on 



a rule not already before the Commission for 
review places the rule before the Commission for 
review. When the Commission decides to call a 
public hearing on a rule, it must publish notice of 
the public hearing in the North Carolina Register. 
After a public hearing on a rule, the Commission 
must approve the rule or object to the rule in 
accordance with the standards and procedures in 
this Part. The Commission must make its decision 
of whether to approve or object to the rule within 
70 days after the public hearing. 
§ 150B-21.15. Declaratory judgment action 
authorized when Commission objects to a per- 
manent rule. 

(a) Standing. -- A person aggrieved by a perma- 
nent rule entered in the North Carolina Adminis- 
trative Code with an objection by the Commission 
based on a lack of statutory authority may file an 
action for declaratory judgment in Wake County 
Superior Court pursuant to Article 26 of Chapter 
1 of the General Statutes. In the action, the court 
shall determine whether the agency exceeded its 
authority in adopting the rule. 

A declaratory judgment action under this section 
must be filed within 90 days after the rule that is 
the subject of the action is entered in the Code. 
Filing a petition for rule making or a request for a 
declaratory ruling with the agency that adopted the 
rule is not a prerequisite to filing an action under 
this section. A person who files an action for 
declaratory judgment under this section must serve 
a copy of the complaint on the agency that adopted 
the rule being contested, the Codifier of Rules, and 
the Commission. 

(b) Record. -- Within 10 days after a declaratory 
judgment action is filed under this section, the 
agency that adopted the rule that is the subject of 
the action must send to the court the original or a 
certified copy of the record in the Commission's 
review of the rule. The record consists of the 
rule, the Commission's letter of objection to the 
rule, the agency's written response to the 
Commission's letter, and any other relevant docu- 
ments before the Commission when it decided to 
object to the rule. 

(c) Effect. — A rule remains in effect during 
the pendency of an action for declaratory judgment 
under this section unless the court suspends the 
rule after finding that the agency that adopted the 
rule has no substantial likelihood of prevailing in 
the action. 

(d) Changes. — While a rule is the subject of a 
declaratory judgment action under this section, the 
agency that adopted the rule may submit to the 
Commission changes in the rule to satisfy the 



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GENERAL STATUTES OF NORTH CAROLINA 



Commission's objection. If the Commission 
determines that changes submitted to it satisfy its 
objection, the Commission must accept the changes 
and file the revised rule with the Codifier of 
Rules. The Codifier must then enter the rule in 
the North Carolina Administrative Code. When 
the Commission determines that changes submitted 
to it satisfy its objection, the agency that submitted 
the changes must notify the court of the changes 
and of the Commission's action. 

Part 4. Publication of Code and Register. 
§ 150B-21.17. North Carolina Register. 

(a) Content. — The Codifier of Rules must 
publish the North Carolina Register. The North 
Carolina Register must be published at least two 
times a month and must contain the following: 

(1) Notices of proposed adoptions of rules. 

(2) Notices of receipt of a petition for 
municipal incorporation, as required by 
G.S. 120-165. 

(3) Executive orders of the Governor. 

(4) Final decision letters from the United 
States Attorney General concerning 
changes in laws that affect voting in a 
jurisdiction subject to § 5 of the Voting 
Rights Act of 1965, as required by 
G.S. 120-30.9H. 

(5) Orders of the Tax Review Board issued 
under G.S. 105-241.2. 

(6) Other information the Codifier deter- 
mines helpful to the public. 

(b) Form. — When an agency publishes notice in 
the North Carolina Register of the proposed text of 
a new rule, the Codifier of Rules must publish the 
complete text of the proposed new rule. In pub- 
lishing the text of a proposed new rule, the Codifi- 
er must indicate the rule is new by underlining the 
proposed text of the rule. 

When an agency publishes notice in the North 
Carolina Register of the proposed text of an 
amendment to an existing rule, the Codifier must 
publish the complete text of the rule that is being 
amended unless the Codifier determines that 
publication of the complete text of the rule being 
amended is not necessary to enable the reader to 
understand the proposed amendment. In publish- 
ing the text of a proposed amendment to a rule, 
the Codifier must indicate deleted text with over- 
strikes and added text with underlines. 

When an agency publishes notice in the North 
Carolina Register of the proposed repeal of an 
existing rule, the Codifier must publish the com- 
plete text of the rule the agency proposes to repeal 
unless the Codifier determines that publication of 
the complete text is impractical. In publishing the 



text of a rule the agency proposes to repeal, the 
Codifier must indicate the rule is to be repealed. 
§ 150B-21.18. North Carolina Administrative 
Code. 

The Codifier of Rules must compile all rules into 
a Code known as the North Carolina Administra- 
tive Code. The format and indexing of the Code 
must conform as nearly as practical to the format 
and indexing of the North Carolina General Stat- 
utes. The Codifier must publish printed copies of 
the Code and may publish the Code in other 
forms. The Codifier must keep the Code current 
by publishing the Code in a loose-leaf format and 
periodically providing new pages to be substituted 
for outdated pages, by publishing the Code in 
volumes and periodically publishing cumulative 
supplements, or by another means. The Codifier 
must keep superseded rules. 
§ 150B-21.19. Requirements for including 
rule in Code. 

To be acceptable for inclusion in the North 
Carolina Administrative Code, a rule must: 

(1) Cite the law under which the rule is 
adopted. 

(2) Be signed by the head of the agency or 
the rule-making coordinator for the agen- 
cy that adopted the rule. 

(3) Be in the physical form specified by the 
Codifier of Rules. 

(4) Have been reviewed by the Commission, 
if the rule is a permanent rule. 

§ 150B-21.20. Codifier's authority to revise 
form of rules. 

(a) Authority. — After consulting with the 
agency that adopted the rule, the Codifier of Rules 
may revise the form of a rule submitted for inclu- 
sion in the North Carolina Administrative Code 
within 10 business days after the rule is submitted 
to do one or more of the following: 

(1) Rearrange the order of the rule in the 
Code or the order of the subsections, 
subdivisions, or other subparts of the 
rule. 

(2) Provide a catch line or heading for the 
rule or revise the catch line or heading 
of the rule. 

(3) Reletter or renumber the rule or the 
subparts of the rule in accordance with 
a uniform system. 

(4) Rearrange definitions and lists. 

(5) Make other changes in arrangement or 
in form that do not change the sub- 
stance of the rule and are necessary or 
desirable for a clear and orderly ar- 
rangement of the rule. 



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(b) Effect. — Revision of a rule by the Codifier 
of Rules under this section does not affect the 
effective date of the rule or require the agency to 
readopt or resubmit the rule. When the Codifier 
of Rules revises the form of a rule, the Codifier of 
Rules must send the agency that adopted the rule 
a copy of the revised rule. The revised rule is the 
official rule. 

§ 150B-21.21. Publication of rules of North 
Carolina State Bar and exempt agencies. 

(a) State Bar. — The North Carolina State Bar 
must submit a rule adopted or approved by it and 
entered in the minutes of the North Carolina 
Supreme Court to the Codifier of Rules for inclu- 
sion in the North Carolina Administrative Code. 
The State Bar must submit a rule within 15 days 
after it is entered in the minutes of the Supreme 
Court. The Codifier of Rules must compile, make 
available for public inspection, and publish a rule 
included in the North Carolina Administrative 
Code under this subsection in the same manner as 
other rules in the Code. 

(b) Exempt Agencies. — Notwithstanding G.S. 
150B-1, the North Carolina Utilities Commission 
must submit to the Codifier of Rules those rules of 
the Utilities Commission that are published from 
time to time in the publication titled "North Caroli- 
na Utilities Laws and Regulations." The Utilities 
Commission must submit a rule required to be 
included in the Code within 15 days after it is 
adopted. The Codifier of Rules must publish the 
rules submitted by the Utilities Commission in the 
North Carolina Administrative Code in the same 
format as they are submitted. 

Notwithstanding G.S. 150B-1, an agency other 
than the Utilities Commission that is exempted 
from this Article by that statute must submit a 
temporary or permanent rule adopted by it to the 
Codifier of Rules for inclusion in the North Caroli- 
na Administrative Code. One of these exempt 
agencies must submit a rule to the Codifier of 
Rules within 15 days after it adopts the rule. The 
Codifier of Rules must compile, make available for 
public inspection, and publish a rule of one of 
these agencies in the North Carolina Administra- 
tive Code in the same manner as other rules in the 
Code. 
§ 150B-21.22. Effect of inclusion in Code. 

Official or judicial notice can be taken of a rule 
in the North Carolina Administrative Code and 
shall be taken when appropriate. Codification of a 
rule in the North Carolina Administrative Code is 
prima facie evidence of compliance with this 
Article. 
§ 150B-21.23. Rule publication manual. 



The Codifier of Rules must publish a manual that 
sets out the form and method for publishing a 
notice of rule making in the North Carolina Regis- 
ter and for filing a rule in the North Carolina 
Administrative Code. 

§ 150B-21.24. Free copies of Register and 
Code. 

(a) Register. — The Codifier of Rules must 
distribute copies of the North Carolina Register as 
soon after publication as practical, without charge, 
to the following: 

(1) A person who receives a free copy of 
the North Carolina Administrative 
Code. 

(2) Upon request, one copy to each mem- 
ber of the General Assembly. 

(b) Code. — The Codifier of Rules must distrib- 
ute copies of the North Carolina Administrative 
Code as soon after publication as practical, without 
charge, to the following: 

(1) One copy to the board of commission- 
ers of each county, to be placed at the 
county clerk of court's office or at 
another place selected by the board of 
commissioners. 

(2) One copy to the Commission. 

(3) One copy to the Clerk of the Supreme 
Court and to the Clerk of the Court of 
Appeals of North Carolina. 

(4) One copy to the Supreme Court Library 
and one copy to the library of the Court 
of Appeals. 

(5) One copy to the Administrative Office 
of the Courts. 

(6) One copy to the Governor. 

(7) Five copies to the Legislative Services 
Commission for the use of the General 
Assembly. 

(8) Upon request, one copy to each State 
official or department to whom or to 
which copies of the appellate division 
reports are furnished under G.S. 
7A-343.1. 

(9) Five copies to the Division of State 
Library of the Department of Cultural 
Resources pursuant to G.S. 125-11.7. 

§ 150B-21.25. Paid copies of Register and 
Code. 

A person who is not entitled to a free copy of the 
North Carolina Administrative Code or North 
Carolina Register may obtain a copy by paying a 
fee set by the Codifier of Rules. The Codifier 
must set separate fees for the North Carolina 
Register and the North Carolina Administrative 
Code in amounts that cover publication, copying. 



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GENERAL STATUTES OF NORTH CAROLINA 



and mailing costs. All monies received under this 
section must be credited to the General Fund. 
Article 3. 
Administrative Hearings. 
§ 150B-22. Settlement; contested case. 

It is the policy of this State that any dispute 
between an agency and another person that in- 
volves the person's rights, duties, or privileges, 
including licensing or the levy of a monetary 
penalty, should be settled through informal proce- 
dures. In trying to reach a settlement through 
informal procedures, the agency may not conduct 
a proceeding at which sworn testimony is taken 
and witnesses may be cross-examined. If the 
agency and the other person do not agree to a 
resolution of the dispute through informal proce- 
dures, either the agency or the person may com- 
mence an administrative proceeding to determine 
the person's rights, duties, or privileges, at which 
time the dispute becomes a "contested case." 
§ 150B-23. Commencement; assignment of 
administrative law judge; hearing required; 
notice; intervention. 

(a) A contested case shall be commenced by 
filing a petition with the Office of Administrative 
Hearings and, except as provided in Article 3A of 
this Chapter, shall be conducted by that Office. 
The party who files the petition shall serve a copy 
of the petition on all other parties and, if the 
dispute concerns a license, the person who holds 
the license. A party who files a petition shall file 
a certificate of service together with the petition. 
A petition shall be signed by a party or a represen- 
tative of the party and, if filed by a party other 
than an agency, shall state facts tending to estab- 
lish that the agency named as the respondent has 
deprived the petitioner of property, has ordered the 
petitioner to pay a fine or civil penalty, or has 
otherwise substantially prejudiced the petitioner's 
rights and that the agency: 

(1) Exceeded its authority or jurisdiction; 

(2) Acted erroneously; 

(3) Failed to use proper procedure; 

(4) Acted arbitrarily or capriciously; or 

(5) Failed to act as required by law or rule. 
The parties in a contested case shall be given an 

opportunity for a hearing without undue delay. 
Any person aggrieved may commence a contested 
case hereunder. 

A local government employee, applicant for 
employment, or former employee to whom Chap- 
ter 126 of the General Statutes applies may com- 
mence a contested case under this Article in the 
same manner as any other petitioner. The case 
shall be conducted in the Office of Administrative 



Hearings in the same manner as other contested 
cases under this Article, except that the decision of 
the State Personnel Commission shall be advisory 
only and not binding on the local appointing 
authority, unless (1) the employee, applicant, or 
former employee has been subjected to discrimina- 
tion prohibited by Article 6 of Chapter 126 of the 
General Statutes or (2) applicable federal stan- 
dards require a binding decision. In these two 
cases, the State Personnel Commission's decision 
shall be binding. 

(al) Repealed by Session Laws 1985 (Reg. 
Sess., 1986), c. 1022, s. 1(9). 

(a2) An administrative law judge assigned to a 
contested case may require a party to the case to 
file a prehearing statement. A party's prehearing 
statement must be served on all other parties to the 
contested case. 

(b) The parties to a contested case shall be given 
a notice of hearing not less than 15 days before the 
hearing by the Office of Administrative Hearings. 
If prehearing statements have been filed in the 
case, the notice shall state the date, hour, and 
place of the hearing. If prehearing statements 
have not been filed in the case, the notice shall 
state the date, hour, place, and nature of the 
hearing, shall list the particular sections of the 
statutes and rules involved, and shall give a short 
and plain statement of the factual allegations. 

(c) Notice shall be given personally or by 
certified mail. If given by certified mail, it shall 
be deemed to have been given on the delivery date 
appearing on the return receipt. If giving of notice 
cannot be accomplished either personally or by 
certified mail, notice shall then be given in the 
manner provided in G.S. 1A-1, Rule 4(jl). 

(d) Any person may petition to become a party 
by filing a motion to intervene in the manner 
provided in G.S. 1A-1, Rule 24. In addition, any 
person interested in a contested case may intervene 
and participate in that proceeding to the extent 
deemed appropriate by the administrative law 
judge. 

(e) All hearings under this Chapter shall be open 
to the public. Hearings shall be conducted in an 
impartial manner. Hearings shall be conducted 
according to the procedures set out in this Article, 
except to the extent and in the particulars that 
specific hearing procedures and time standards are 
governed by another statute. 

(f) Unless another statute or a federal statute or 
regulation sets a time limitation for the filing of a 
petition in contested cases against a specified 
agency, the general limitation for the filing of a 
petition in a contested case is 60 days. The time 



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GENERAL STATUTES OF NORTH CAROLINA 



limitation, whether established by another statute, 
federal statute, or federal regulation, or this 
section, shall commence when notice is given of 
the agency decision to all persons aggrieved who 
are known to the agency by personal delivery or 
by the placing of the notice in an official deposito- 
ry of the United States Postal Service wrapped in 
a wrapper addressed to the person at the latest 
address given by the person to the agency. The 
notice shall be in writing, and shall set forth the 
agency action, and shall inform the persons of the 
right, the procedure, and the time limit to file a 
contested case petition. When no informal settle- 
ment request has been received by the agency 
prior to issuance of the notice, any subsequent 
informal settlement request shall not suspend the 
time limitation for the filing of a petition for a 
contested case hearing. 
§ 150B-24. Venue of hearing. 

(a) The hearing of a contested case shall be 
conducted: 

(1) In the county in this State in which any 
person whose property or rights are the 
subject matter of the hearing maintains 
his residence; 

(2) In the county where the agency main- 
tains its principal office if the property 
or rights that are the subject matter of 
the hearing do not affect any person or 
if the subject matter of the hearing is 
the property or rights of residents of 
more than one county; or 

(3) In any county determined by the admin- 
istrative law judge in his discretion to 
promote the ends of justice or better 
serve the convenience of witnesses. 

(b) Any person whose property or rights are the 
subject matter of the hearing waives his objection 
to venue by proceeding in the hearing. 

§ 150B-25. Conduct of hearing; answer. 

(a) If a party fails to appear in a contested case 
after proper service of notice, and if no adjourn- 
ment or continuance is granted, the administrative 
law judge may proceed with the hearing in the 
absence of the party. 

(b) Repealed. 

(c) The parties shall be given an opportunity to 
present arguments on issues of law and policy and 
an opportunity to present evidence on issues of 
fact. 

(d) A party may cross-examine any witness, 
including the author of a document prepared by, 
on behalf of, or for use of the agency and offered 
in evidence. Any party may submit rebuttal 
evidence. 



§ 150B-26. Consolidation. 

When contested cases involving a common 
question of law or fact or multiple proceedings 
involving the same or related parties are pending, 
the Director of the Office of Administrative Hear- 
ings may order a joint hearing of any matters at 
issue in the cases, order the cases consolidated, or 
make other orders to reduce costs or delay in the 
proceedings. 
§ 150B-27. Subpoena. 

After the commencement of a contested case, 
subpoenas may be issued and served in accordance 
with G.S. 1A-1, Rule 45. In addition to the 
methods of service in G.S. 1A-1, Rule 45, a State 
law enforcement officer may serve a subpoena on 
behalf of an agency that is a party to the contested 
case by any method by which a sheriff may serve 
a subpoena under that Rule. Upon a motion, the 
administrative law judge may quash a subpoena if, 
upon a hearing, the administrative law judge finds 
that the evidence the production of which is re- 
quired does not relate to a matter in issue, the 
subpoena does not describe with sufficient particu- 
larity the evidence the production of which is 
required, or for any other reason sufficient in law 
the subpoena may be quashed. Witness fees shall 
be paid by the party requesting the subpoena to 
subpoenaed witnesses in accordance with G.S. 
7A-314. However, State officials or employees 
who are subpoenaed shall not be entitled to witness 
fees, but they shall receive their normal salary and 
they shall not be required to take any annual leave 
for the witness days. Travel expenses of State 
officials or employees who are subpoenaed shall be 
reimbursed as provided in G.S. 138-6. 
§ 150B-28. Depositions and discovery. 

(a) A deposition may be used in lieu of other 
evidence when taken in compliance with the Rules 
of Civil Procedure, G.S. 1A-1. Parties in contest- 
ed cases may engage in discovery pursuant to the 
provisions of the Rules of Civil Procedure, G.S. 
1A-1. 

(b) On a request for identifiable agency records, 
with respect to material facts involved in a contest- 
ed case, except records related solely to the inter- 
nal procedures of the agency or which are exempt 
from disclosure by law, an agency shall promptly 
make the records available to a party. 

§ 150B-29. Rules of evidence. 

(a) In all contested cases, irrelevant, immaterial 
and unduly repetitious evidence shall be excluded. 
Except as otherwise provided, the rules of evi- 
dence as applied in the trial division of the General 
Court of Justice shall be followed; but. when 
evidence is not reasonably available under the 



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rules to show relevant facts, then the most reliable 
and substantial evidence available shall be admit- 
ted. On the judge's own motion, an administrative 
law judge may exclude evidence that is inadmissi- 
ble under this section. It shall not be necessary 
for a party or his attorney to object at the hearing 
to evidence in order to preserve the right to object 
to its consideration by the administrative law judge 
in making a recommended decision, by the agency 
in making a final decision, or by the court on 
judicial review. 

(b) Evidence in a contested case, including 
records and documents, shall be offered and made 
a part of the record. Factual information or 
evidence not made a part of the record shall not be 
considered in the determination of the case, except 
as permitted under G.S. 150B-30. Documentary 
evidence may be received in the form of a copy or 
excerpt or may be incorporated by reference, if the 
materials so incorporated are available for exami- 
nation by the parties. Upon timely request, a 
party shall be given an opportunity to compare the 
copy with the original if available. 
§ 150B-30. Official notice. 

Official notice may be taken of all facts of which 
judicial notice may be taken and of other facts 
within the specialized knowledge of the agency. 
The noticed fact and its source shall be stated and 
made known to affected parties at the earliest 
practicable time, and any party shall on timely 
request be afforded an opportunity to dispute the 
noticed fact through submission of evidence and 
argument. 
§ 150B-31. Stipulations. 

(a) The parties in a contested case may, by a 
stipulation in writing filed with the administrative 
law judge, agree upon any fact involved in the 
controversy, which stipulation shall be used as 
evidence at the hearing and be binding on the 
parties thereto. Parties should agree upon facts 
when practicable. 

(b) Except as otherwise provided by law, dispo- 
sition may be made of a contested case by stipula- 
tion, agreed settlement, consent order, waiver, 
default, or other method agreed upon by the 
parties. 

§ 150B-32. Designation of administrative law 
judge. 

(a) The Director of the Office of Administrative 
Hearings shall assign himself or another adminis- 
trative law judge to preside over a contested case. 

(al) Repealed by Session Laws 1985 (Reg. 
Sess., 1986), c. 1022, s. 1 (15), effective July 15, 
1986. 

(b) On the filing in good faith by a party of a 



timely and sufficient affidavit of personal bias or 
disqualification of an administrative law judge, the 
administrative law judge shall determine the matter 
as a part of the record in the case, and this deter- 
mination shall be subject to judicial review at the 
conclusion of the proceeding. 

(c) When an administrative law judge is disqual- 
ified or it is impracticable for him to continue the 
hearing, the Director shall assign another adminis- 
trative law judge to continue with the case unless 
it is shown that substantial prejudice to any party 
will result, in which event a new hearing shall be 
held or the case dismissed without prejudice. 
§ 150B-33. Powers of administrative law 
judge. 

(a) An administrative law judge shall stay any 
contested case under this Article on motion of an 
agency which is a party to the contested case, if 
the agency shows by supporting affidavits that it is 
engaged in other litigation or administrative pro- 
ceedings, by whatever name called, with or before 
a federal agency, and this other litigation or 
administrative proceedings will determine the 
position, in whole or in part, of the agency in the 
contested case. At the conclusion of the other 
litigation or administrative proceedings, the con- 
tested case shall proceed and be determined as 
expeditiously as possible. 

(b) An administrative law judge may: 

(1) Administer oaths and affirmations; 

(2) Sign, issue, and rule on subpoenas in 
accordance with G.S. 150B-27 and 
G.S. 1A-1, Rule 45; 

(3) Provide for the taking of testimony by 
deposition and rule on all objections to 
discovery in accordance with G.S. 
1A-1, the Rules of Civil Procedure; 

(3a) Rule on all prehearing motions that are 
authorized by G.S. 1A-1, the Rules of 
Civil Procedure; 

(4) Regulate the course of the hearings, 
including discovery, set the time and 
place for continued hearings, and fix 
the time for filing of briefs and other 
documents; 

(5) Direct the parties to appear and confer 
to consider simplification of the issues 
by consent of the parties; 

(6) Stay the contested action by the agency 
pending the outcome of the case, upon 
such terms as he deems proper, and 
subject to the provisions of G.S. 1A-1, 
Rule 65; 

(7) Determine whether the hearing shall be 
recorded by a stenographer or by an 



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GENERAL STATUTES OF NORTH CAROLINA 



electronic device; and 

(8) Enter an order returnable in the General 
Court of Justice, Superior Court Divi- 
sion, to show cause why the person 
should not be held in contempt. The 
Court shall have the power to impose 
punishment as for contempt for any act 
which would constitute direct or indi- 
rect contempt if the act occurred in an 
action pending in Superior Court. 

(9) Determine that a rule as applied in a 
particular case is void because (1) it is 
not within the statutory authority of the 
agency, (2) is not clear and unambigu- 
ous to persons it is intended to direct, 
guide, or assist, or (3) is not reasonably 
necessary to enable the agency to fulfill 
a duty delegated to it by the General 
Assembly. 

(10) Impose the sanctions provided for in 
G.S. 1 A-l or Chapter 3 of Title 26 of 
the North Carolina Administrative Code 
for noncompliance with applicable 
procedural rules. 

§ 150B-34. Recommended decision or order 
of administrative law judge. 

(a) Except as provided in G.S. 150B-36(c), in 
each contested case the administrative law judge 
shall make a recommended decision or order that 
contains findings of fact and conclusions of law. 

(b) Repealed. 

§ 150B-35. No ex parte communication; 

exceptions. 

Unless required for disposition of an ex parte 
matter authorized by law, neither the administra- 
tive law judge assigned to a contested case nor a 
member or employee of the agency making a final 
decision in the case may communicate, directly or 
indirectly, in connection with any issue of fact, or 
question of law, with any person or party or his 
representative, except on notice and opportunity 
for all parties to participate. 
§ 150B-36. Final decision. 

(a) Before the agency makes a final decision, it 
shall give each party an opportunity to file excep- 
tions to the decision recommended by the adminis- 
trative law judge, and to present written arguments 
to those in the agency who will make the final 
decision or order. If a party files in good faith a 
timely and sufficient affidavit of personal bias or 
other reason for disqualification of a member of 
the agency making the final decision, the agency 
shall determine the matter as a part of the record 
in the case, and the determination is subject to 
judicial review at the conclusion of the case. 



(b) A final decision or order in a contested case 
shall be made by the agency in writing after 
review of the official record as defined in G.S. 
150B-37(a) and shall include findings of fact and 
conclusions of law. If the agency does not adopt 
the administrative law judge's recommended 
decision as its final decision, the agency shall state 
in its decision or order the specific reasons why it 
did not adopt the administrative law judge's rec- 
ommended decision. The agency may consider 
only the official record prepared pursuant to G.S. 
150B-37 in making a final decision or order, and 
the final decision or order shall be supported by 
substantial evidence admissible under G.S. 
150B-29(a), 150B-30. or 150B-31. A copy of the 
decision or order shall be served upon each party 
personally or by certified mail addressed to the 
party at the latest address given by the party to the 
agency, and a copy shall be furnished to his 
attorney of record and the Office of Administrative 
Hearings. 

(c) The following decisions made by administra- 
tive law judges in contested cases are final deci- 
sions: 

(1) A determination that the Office of 
Administrative Hearings lacks jurisdic- 
tion. 

(2) An order entered pursuant to the au- 
thority in G.S. 7A-759(e). 

(3) An order entered pursuant to a written 
prehearing motion that either dismisses 
the contested case for failure of the 
petitioner to prosecute or grants the 
relief requested when a party does not 
comply with procedural requirements. 

(4) An order entered pursuant to a 
prehearing motion to dismiss the con- 
tested case in accordance with G.S. 
1A-1, Rule 12(b) when the order dis- 
poses of all issues in the contested case. 

§ 150B-37. Official record. 

(a) In a contested case, the Office of Adminis- 
trative Hearings shall prepare an official record of 
the case that includes: 

(1) Notices, pleadings, motions, and inter- 
mediate rulings; 

(2) Questions and offers of proof, objec- 
tions, and rulings thereon; 

(3) Evidence presented; 

(4) Matters officially noticed, except mat- 
ters so obvious that a statement of them 
would serve no useful purpose; and 

(5) Repealed by Session Laws 1987. c. 
878, s. 25, effective August 14, 1987. 

(6) The administrative law judge's recom- 



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GENERAL STATUTES OF NORTH CAROLINA 



mended decision or order, 
(b) Proceedings at which oral evidence is 
presented shall be recorded, but need not be 
transcribed unless requested by a party. Each 
party shall bear the cost of the transcript or part 
thereof or copy of said transcript or part thereof 
which said party requests, and said transcript or 
part thereof shall be added to the official record as 
an exhibit. 

(c) The Office of Administrative Hearings shall 
forward a copy of the official record to the agency 
making the final decision and shall forward a copy 
of the recommended decision to each party. 
Article 3A. 
Other Administrative Hearings. 
§ 150B-38. Scope; hearing required; notice; 
venue. 

(a) The provisions of this Article shall apply to 
the following agencies: 

(1) Occupational licensing agencies; 

(2) The State Banking Commission, the 
Commissioner of Banks, the Savings 
Institutions Division of the Department 
of Economic and Community Develop- 
ment, and the Credit Union Division of 
the Department of Economic and Com- 
munity Development; and 

(3) The Department of Insurance and the 
Commissioner of Insurance. 

(b) Prior to any agency action in a contested 
case, the agency shall give the parties in the case 
an opportunity for a hearing without undue delay 
and notice not less than 15 days before the hear- 
ing. Notice to the parties shall include: 

(1) A statement of the date, hour, place, 
and nature of the hearing; 

(2) A reference to the particular sections of 
the statutes and rules involved; and 

(3) A short and plain statement of the facts 
alleged. 

(c) Notice shall be given personally or by 
certified mail. If given by certified mail, notice 
shall be deemed to have been given on the delivery 
date appearing on the return receipt. If notice 
cannot be given personally or by certified mail, 
then notice shall be given in the manner provided 
in G.S. 1A-1, Rule 4(jl). 

(d) A party who has been served with a notice 
of hearing may file a written response with the 
agency. If a written response is filed, a copy of 
the response must be mailed to all other parties not 
less than 10 days before the date set for the hear- 
ing. 

(e) All hearings conducted under this Article 
shall be open to the public. A hearing conducted 



by the agency shall be held in the county where 
the agency maintains its principal office. A 
hearing conducted for the agency by an administra- 
tive law judge requested under G.S. 150B-40 shall 
be held in a county in this State where any person 
whose property or rights are the subject matter of 
the hearing resides. If a different venue would 
promote the ends of justice or better serve the 
convenience of witnesses, the agency or the admin- 
istrative law judge may designate another county. 
A person whose property or rights are the subject 
matter of the hearing waives his objection to venue 
if he proceeds in the hearing. 

(f) Any person may petition to become a party 
by filing with the agency or hearing officer a 
motion to intervene in the manner provided by 
G.S. 1 A- 1 , Rule 24. In addition, any person 
interested in a contested case under this Article 
may intervene and participate to the extent deemed 
appropriate by the agency hearing officer. 

(g) When contested cases involving a common 
question of law or fact or multiple proceedings 
involving the same or related parties are pending 
before an agency, the agency may order a joint 
hearing of any matters at issue in the cases, order 
the cases consolidated, or make other orders to 
reduce costs or delay in the proceedings. 

(h) Every agency shall adopt rules governing the 
conduct of hearings that are consistent with the 
provisions of this Article. 

§ 150B-39. Depositions; discovery; subpoe- 
nas. 

(a) A deposition may be used in lieu of other 
evidence when taken in compliance with the Rules 
of Civil Procedure, G.S. 1A-1. Parties in a 
contested case may engage in discovery pursuant 
to the provisions of the Rules of Civil Procedure, 
G.S. 1A-1. 

(b) Upon a request for an identifiable agency 
record involving a material fact in a contested 
case, the agency shall promptly provide the record 
to a party, unless the record relates solely to the 
agency's internal procedures or is exempt from 
disclosure by law. 

(c) In preparation for, or in the conduct of, a 
contested case subpoenas may be issued and served 
in accordance with G.S. 1A-1, Rule 45. Upon a 
motion, the agency may quash a subpoena if, upon 
a hearing, the agency finds that the evidence, the 
production of which is required, does not relate to 
a matter in issue, the subpoena does not describe 
with sufficient particularity the evidence the 
production of which is required, or for any other 
reason sufficient in law the subpoena may be 
quashed. Witness fees shall be paid by the party 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1270 



GENERAL STATUTES OF NORTH CAROLINA 



requesting the subpoena to subpoenaed witnesses 
in accordance with G.S. 7A-314. However. State 
officials or employees who are subpoenaed shall 
not be entitled to any witness fees, but they shall 
receive their normal salary and they shall not be 
required to take any annual leave for the witness 
days. Travel expenses of State officials or em- 
ployees who are subpoenaed shall be reimbursed 
as provided in G.S. 138-6. 

§ 150B-40. Conduct of hearing; presiding 
officer: ex parte communication. 

(a) Hearings shall be conducted in a fair and 
impartial manner. At the hearing, the agency and 
the parties shall be given an opportunity to present 
evidence on issues of fact, examine and 
cross-examine witnesses, including the author of a 
document prepared by. on behalf of or for the use 
of the agency and offered into evidence, submit 
rebuttal evidence, and present arguments on issues 
of law or policy. 

If a party fails to appear in a contested case after 
he has been given proper notice, the agency may 
continue the hearing or proceed with the hearing 
and make its decision in the absence of the party. 

(b) Except as provided under subsection (e) of 
this section, hearings under this Article shall be 
conducted by a majority of the agency. An agency 
shall designate one or more of its members to 
preside at the hearing. If a party files in good 
faith a timely and sufficient affidavit of the person- 
al bias or other reason for disqualification of any 
member of the agency, the agency shall determine 
the matter as a part of the record in the case, and 
its determination shall be subject to judicial review 
at the conclusion of the proceeding. If a presiding 
officer is disqualified or it is impracticable for him 
to continue the hearing, another presiding officer 
shall be assigned to continue with the case, except 
that if assignment of a new presiding officer will 
cause substantial prejudice tc any party, a new 
hearing shall be held or the case dismissed without 
prejudice. 

(c) The presiding officer may: 

(1) Administer oaths and affirmations; 

(2) Sign and issue subpoenas in the name 
of the agency, requiring attendance and 
giving of testimony by witnesses and 
the production of books, papers, and 
other documentary evidence; 

(3) Provide for the taking of testimony by 
deposition; 

(4) Regulate the course of the hearings, set 
the time and place for continued hear- 
ings, and fix the time for filing of 
briefs and other documents: 



(5) Direct the parties to appear and confer 
to consider simplification of the issues 
by consent of the parties; and 

(6) Apply to any judge of the superior 
court resident in the district or presid- 
ing at a term of court in the county 
where a hearing is pending for an order 
to show cause why any person should 
not be held in contempt of the agency 
and its processes, and the court shall 
have the power to impose punishment 
as for contempt for acts which would 
constitute direct or indirect contempt if 
the acts occurred in an action pending 
in superior court. 

(d) Unless required for disposition of an ex 
parte matter authorized by law, a member of an 
agency assigned to make a decision or to make 
findings of fact and conclusions of law in a con- 
tested case under this Article shall not communi- 
cate, directly or indirectly, in connection with any 
issue of fact or question of law. with any person or 
party or his representative, except on notice and 
opportunity for all parties to participate. This 
prohibition begins at the time of the notice of 
hearing. An agency member may communicate 
with other members of the agency and may have 
the aid and advice of the agency staff other than 
the staff which has been or is engaged in investi- 
gating or prosecuting functions in connection with 
the case under consideration or a factually-related 
case. This section does not apply to an agency 
employee or party representative with professional 
training in accounting, actuarial science, econom- 
ics or financial analysis insofar as the case in- 
volves financial practices or conditions. 

(e) When a majority of an agency is unable or 
elects not to hear a contested case, the agency shall 
apply to the Director of the Office of Administra- 
tive Hearings for the designation of an administra- 
tive law judge to preside at the hearing of a con- 
tested case under this Article. Upon receipt of the 
application, the Director shall, without undue 
delay, assign an administrative law judge to hear 
the case. 

The provisions of this Article, rather than the 
provisions of Article 3, shall govern a contested 
case in which the agency requests an administra- 
tive law judge from the Office of Administrative 
Hearings. 

The administrative law judge assigned to hear a 
contested case under this Article shall sit in place 
of the agency and shall have the authority of the 
presiding officer in a contested case under this 
Article. The administrative law judge shall make 



1271 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



GENERAL STATUTES OF NORTH CAROLINA 



a proposal for decision, which shall contain pro- 
posed findings of fact and proposed conclusions of 
law. 

An administrative law judge shall stay any 
contested case under this Article on motion of an 
agency which is a party to the contested case, if 
the agency shows by supporting affidavits that it is 
engaged in other litigation or administrative pro- 
ceedings, by whatever name called, with or before 
a federal agency, and this other litigation or 
administrative proceedings will determine the 
position, in whole or in part, of the agency in the 
contested case. At the conclusion of the other 
litigation or administrative proceedings, the con- 
tested case shall proceed and be determined as 
expeditiously as possible. 

The agency may make its final decision only 
after the administrative law judge's proposal for 
decision is served on the parties, and an opportuni- 
ty is given to each party to file exceptions and 
proposed findings of fact and to present oral and 
written arguments to the agency. 
§ 150B-41. Evidence; stipulations; official 
notice. 

(a) In all contested cases, irrelevant, immaterial, 
and unduly repetitious evidence shall be excluded. 
Except as otherwise provided, the rules of evi- 
dence as applied in the trial division of the General 
Court of Justice shall be followed; but, when 
evidence is not reasonably available under such 
rules to show relevant facts, they may be shown 
by the most reliable and substantial evidence 
available. It shall not be necessary for a party or 
his attorney to object to evidence at the hearing in 
order to preserve the right to object to its consider- 
ation by the agency in reaching its decision, or by 
the court of judicial review. 

(b) Evidence in a contested case, including 
records and documents shall be offered and made 
a part of the record. Other factual information or 
evidence shall not be considered in determination 
of the case, except as permitted under G.S. 
150B-30. Documentary evidence may be received 
in the form of a copy or excerpt or may be incor- 
porated by reference, if the materials so incorpo- 
rated are available for examination by the parties. 
Upon timely request, a party shall be given an 
opportunity to compare the copy with the original 
if available. 

(c) The parties in a contested case under this 
Article by a stipulation in writing filed with the 
agency may agree upon any fact involved in the 
controversy, which stipulation shall be used as 
evidence at the hearing and be binding on the 
parties thereto. Parties should agree upon facts 



when practicable. Except as otherwise provided 
by law, disposition may be made of a contested 
case by stipulation, agreed settlement, consent 
order, waiver, default, or other method agreed 
upon by the parties. 

(d) Official notice may be taken of all facts of 
which judicial notice may be taken and of other 
facts within the specialized knowledge of the 
agency. The noticed fact and its source shall be 
stated and made known to affected parties at the 
earliest practicable time, and any party shall on 
timely request be afforded an opportunity to 
dispute the noticed fact through submission of 
evidence and argument. An agency may use its 
experience, technical competence, and specialized 
knowledge in the evaluation of evidence presented 
to it. 

§ 150B-42. Final agency decision; official 
record. 

(a) After compliance with the provisions of G.S. 
150B-40(e), if applicable, and review of the 
official record, as defined in subsection (b) of this 
section, an agency shall make a written final 
decision or order in a contested case. The deci- 
sion or order shall include findings of fact and 
conclusions of law. Findings of fact shall be based 
exclusively on the evidence and on matters offi- 
cially noticed. Findings of fact, if set forth in 
statutory language, shall be accompanied by a 
concise and explicit statement of the underlying 
facts supporting them. A decision or order shall 
not be made except upon consideration of the 
record as a whole or such portion thereof as may 
be cited by any party to the proceeding and shall 
be supported by substantial evidence admissible 
under G.S. 150B-41. A copy of the decision or 
order shall be served upon each party personally 
or by certified mail addressed to the party at the 
latest address given by the party to the agency and 
a copy shall be furnished to his attorney of record. 

(b) An agency shall prepare an official record of 
a hearing that shall include: 

(1) Notices, pleadings, motions, and inter- 
mediate rulings; 

(2) Questions and offers of proof, objec- 
tions, and rulings thereon; 

(3) Evidence presented; 

(4) Matters officially noticed, except mat- 
ters so obvious that a statement of them 
would serve no useful purpose; 

(5) Proposed findings and exceptions; and 

(6) Any decision, opinion, order, or report 
by the officer presiding at the hearing 
and by the agency. 

(c) Proceedings at which oral evidence is pre- 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1272 



GENERAL STATUTES OF NORTH CAROLINA 



sented shall be recorded, but need not be tran- 
scribed unless requested by a party. Each party 
shall bear the cost of the transcript or part thereof 
or copy of said transcript or part thereof which 
said party requests. 

Article 4. 
Judicial Review. 
§ 150B-43. Right to judicial review. 

Any person who is aggrieved by the final deci- 
sion in a contested case, and who has exhausted all 
administrative remedies made available to him by 
statute or agency rule, is entitled to judicial review 
of the decision under this Article, unless adequate 
procedure for judicial review is provided by 
another statute, in which case the review shall be 
under such other statute. Nothing in this Chapter 
shall prevent any person from invoking any judi- 
cial remedy available to him under the law to test 
the validity of any administrative action not made 
reviewable under this Article. 
§ 150B-44. Right to judicial intervention 
when decision unreasonably delayed. 

Unreasonable delay on the part of any agency or 
administrative law judge in taking any required 
action shall be justification for any person whose 
rights, duties, or privileges are adversely affected 
by such delay to seek a court order compelling 
action by the agency or administrative law judge. 
An agency that is subject to Article 3 of this 
Chapter and is not a board or commission has 90 
days from the day it receives the official record in 
a contested case from the Office of Administrative 
Hearings to make a final decision in the case. 
This time limit may be extended by the parties or, 
for good cause shown, by the agency for an 
additional period of up to 90 days. An agency that 
is subject to Article 3 of this Chapter and is a 
board or commission has 90 days from the day it 
receives the official record in a contested case 
from the Office of Administrative Hearings or 90 
days after its next regularly scheduled meeting, 
whichever is longer, to make a final decision in 
the case. This time limit may be extended by the 
parties or, for good cause shown, by the agency 
for an additional period of up to 90 days. If an 
agency subject to Article 3 of this Chapter has not 
made a final decision within these time limits, the 
agency is considered to have adopted the adminis- 
trative law judge's recommended decision as the 
agency's final decision. Failure of an agency 
subject to Article 3A of this Chapter to make a 
final decision within 180 days of the close of the 
contested case hearing is justification for a person 
whose rights, duties, or privileges are adversely 
affected by the delay to seek a court order compel- 



ling action by the agency or, if the case was heard 
by an administrative law judge, by the administra- 
tive law judge. 

§ 150B-45. Procedure for seeking review; 
waiver. 

To obtain judicial review of a final decision 
under this Article, the person seeking review must 
file a petition in the Superior Court of Wake 
County or in the superior court of the county 
where the person resides. 

The person seeking review must file the petition 
within 30 days after the person is served with a 
written copy of the decision. A person who fails 
to file a petition within the required time waives 
the right to judicial review under this Article. For 
good cause shown, however, the superior court 
may accept an untimely petition. 
§ 150B-46. Contents of petition; copies served 
on all parties; intervention. 

The petition shall explicitly state what exceptions 
are taken to the decision or procedure and what 
relief the petitioner seeks. Within 10 days after 
the petition is filed with the court, the party 
seeking the review shall serve copies of the peti- 
tion by personal service or by certified mail upon 
all who were parties of record to the administrative 
proceedings. Names and addresses of such parties 
shall be furnished to the petitioner by the agency 
upon request. Any party to the administrative 
proceeding is a party to the review proceedings 
unless the party withdraws by notifying the court 
of the withdrawal and serving the other parties 
with notice of the withdrawal. Other parties to the 
proceeding may file a response to the petition 
within 30 days of service. Parties, including 
agencies, may state exceptions to the decision or 
procedure and what relief is sought in the re- 
sponse. 

Any person aggrieved may petition to become a 
party by filing a motion to intervene as provided in 
G.S. 1A-1, Rule 24. 

§ 150B-47. Records fded with clerk of superi- 
or court; contents of records; costs. 

Within 30 days after receipt of the copy of the 
petition for review, or within such additional time 
as the court may allow, the agency that made the 
final decision in the contested case shall transmit 
to the reviewing court the original or a certified 
copy of the official record in the contested case 
under review together with: (i) any exceptions, 
proposed findings of fact, or written arguments 
submitted to the agency in accordance with G.S. 
150B-36(a); and (ii) the agency's final decision or 
order. With the permission of the court, the 
record may be shortened by stipulation of all 



1273 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



GENERAL STATUTES OF NORTH CAROLINA 



parties to the review proceedings. Any party 
unreasonably refusing to stipulate to limit the 
record may be taxed by the court for such addi- 
tional costs as may be occasioned by the refusal. 
The court may require or permit subsequent 
corrections or additions to the record when deemed 
desirable. 
§ 150B-48. Stay of decision. 

At any time before or during the review proceed- 
ing, the person aggrieved may apply to the review- 
ing court for an order staying the operation of the 
administrative decision pending the outcome of the 
review. The court may grant or deny the stay in 
its discretion upon such terms as it deems proper 
and subject to the provisions of G.S. 1A-1, Rule 
65. 
§ 150B-49. New evidence. 

An aggrieved person who files a petition in the 
superior court may apply to the court to present 
additional evidence. If the court is satisfied that 
the evidence is material to the issues, is not merely 
cumulative, and could not reasonably have been 
presented at the administrative hearing, the court 
may remand the case so that additional evidence 
can be taken. If an administrative law judge did 
not make a recommended decision in the case, the 
court shall remand the case to the agency that 
conducted the administrative hearing. After 
hearing the evidence, the agency may affirm or 
modify its previous findings of fact and final 
decision. If an administrative law judge made a 
recommended decision in the case, the court shall 
remand the case to the administrative law judge. 
After hearing the evidence, the administrative law 
judge may affirm or modify his previous findings 
of fact and recommended decision. The administra- 
tive law judge shall forward a copy of his decision 
to the agency that made the final decision, which 
in turn may affirm or modify its previous findings 
of fact and final decision. The additional evidence 
and any affirmation or modification of a recom- 
mended decision or final decision shall be made 
part of the official record. 

§ 150B-50. Review by superior court without 
jury- 

The review by a superior court of agency deci- 
sions under this Chapter shall be conducted by the 
court without a jury. 
§ 150B-51. Scope of review. 

(a) Initial Determination in Certain Cases. In 
reviewing a final decision in a contested case in 
which an administrative law judge made a recom- 
mended decision, the court shall make two initial 
determinations. First, the court shall determine 
whether the agency heard new evidence after 



receiving the recommended decision. If the court 
determines that the agency heard new evidence, 
the court shall reverse the decision or remand the 
case to the agency to enter a decision in accor- 
dance with the evidence in the official record. 
Second, if the agency did not adopt the recom- 
mended decision, the court shall determine wheth- 
er the agency's decision states the specific reasons 
why the agency did not adopt the recommended 
decision. If the court determines that the agency 
did not state specific reasons why it did not adopt 
a recommended decision, the court shall reverse 
the decision or remand the case to the agency to 
enter the specific reasons. 

(b) Standard of Review. After making the 
determinations, if any, required by subsection (a), 
the court reviewing a final decision may affirm the 
decision of the agency or remand the case for 
further proceedings. It may also reverse or modi- 
fy the agency's decision if the substantial rights of 
the petitioners may have been prejudiced because 
the agency's findings, inferences, conclusions, or 
decisions are: 

(1) In violation of constitutional provisions; 

(2) In excess of the statutory authority or 
jurisdiction of the agency; 

(3) Made upon unlawful procedure; 

(4) Affected by other error of law; 

(5) Unsupported by substantial evidence 
admissible under G.S. 150B-29(a), 
150B-30, or 150B-31 in view of the 
entire record as submitted; or 

(6) Arbitrary or capricious. 

§ 150B-52. Appeal; stay of court's decision. 
A party to a review proceeding in a superior 
court may appeal to the appellate division from the 
final judgment of the superior court as provided in 
G.S. 7A-27. Pending the outcome of an appeal, 
an appealing party may apply to the court that 
issued the judgment under appeal for a stay of that 
judgment or a stay of the administrative decision 
that is the subject of the appeal, as appropriate. 

Article 5. 
Publication of Administrative Rules. 

Repealed. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1274 



IN ADDITION 



G.S. 1 20-30. 9H, effective July 16, 1986, requires that all letters and other documents issued by the 
Attorney General of the United States in which a final decision is made concerning a "change affecting 
voting " under Section 5 of the Voting Rights Act of 1965 be published in the North Carolina Register . 



( 



U.S. Department of Justice 

Civil Rights Division 

JRD:LLT:CGM:lrj Voting Section 

DJ 166-012-3 P.O. Box 66128 

92-3079 Washington, D.C. 20035-6128 

92-3343 

August 28, 1992 

Jesse L. Warren, Esq. 

City Attorney 

Drawer W-2 

Greensboro, North Carolina 27402 

Dear Mr. Warren: 

This refers to two annexations (Ordinance Nos. 92-75 and 92-88) and the designation of the annexed 
areas to election districts for the City of Greensboro in Guilford County, North Carolina, submissions, / 

submitted to the Attorney General pursuant to Section 5 of the Voting Rights Act of 1965, as amended, 42 
U.S.C. 1973c. We received your submissions on June 29 and July 20, 1992. 

The Attorney General does not interpose any objection to the specified changes. However, we note 
that Section 5 expressly provides that the failure of the Attorney General to object does not bar subsequent 
litigation to enjoin the enforcement of the changes. In addition, as authorized by Section 5, we reserve the 
right to reexamine this submission if additional information that would otherwise require an objection comes 
to our attention during the remainder of the sixty-day review period. See the Procedures for the 
Administration of Section 5 (28 C.F.R. 51.41 and 51.43). 

Sincerely, 

John R. Dunn 

Assistant Attorney General 

Civil Right Division 



By: 



Steven H. Rosenbaum 
Chief, Voting Section 



< 



1275 7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



TITLE 2 - DEPARTMENT OF 
AGRICULTURE 

Notice is hereby given in accordance with G.S. 
150B-21. 2 that the North Carolina Pesticide Board 
intends to amend rule(s) cited as 2 NCAC 9L 
.0524 and .0701 . 

1 he proposed effective date of this action is 
February 1, 1993. 

1 he public hearing will be conducted at 1:00 
p.m. on November 5, 1992, at the Board Room, 
Agriculture Building, 2 West Ed en ton Street, 
Raleigh, NC 27601. 

Keason for Proposed Action: 

2 NCAC9L . 0524 - To include pest control consul- 
tants examination requirement citation from the 
N. C. Pesticide Law of 1971. 

2 NCAC9L .0701 - To amend the North Carolina 
Pesticide Board's current rule in which pine voles 
and meadow voles have been declared to be pests 
in certain sites, to clarify those sites, and to 
include the additional sites of institutional, recre- 
ational, and residential areas. 

(comment Procedures: Interested persons may 
present statements either orally or in writing at the 
public hearing or in writing prior to the hearing by 
mail addressed to John L. Smith, Secretary, North 
Carolina Pesticide Board, P. O. Box 27647, Ra- 
leigh, NC 27611. 

CHAPTER 9 - FOOD AND DRUG PROTEC- 
TION DIVISION 

SUBCHAPTER 9L - PESTICIDE SECTION 

SECTION .0500 - PESTICIDE LICENSES 

.0524 EXPIRATION OF CERTIFICATION 

(a) The recertification period shall expire on 
June 30th. 

(b) At the direction of the Board, each certified 
individual will be notified 6-9 months prior to the 
recertification expiration date of the individual's 
remaining requirements for recertification. 



(c) A certified individual who has completed 
none of the recertification options in Rule .0522 of 
this Section prior to the recertification expiration 
date shall be required to retake and satisfactorily 
pass a comprehensive license examination defined 
in G.S. 143-453 or 143-455 before a license will 
be reissued in any category. This examination will 
be based on updated training materials approved 
by the Board. 

(d) No individual will be allowed to carry over 
any Continuing Certification Credits from one 
recertification period to another. 

Statutory Authority G.S. 143-437(1); 143-440(b); 
143-453(c)(2); 143-455(d). 



SECTION .0700 - DECLARATION OF 

PESTS AND RESTRICTIONS ON 

THEIR CONTROL 



.0701 ORCHARD RATS 

The North Carolina Pesticide Board hereby 
declares as a pest pine voles [Pitymys (or Micro- 
tus) Pinetorum] and meadow voles (Microtus 
pennsylvanicus), (commonly called orchard rats) 
on or immediately adjacent to cultivated land or 
horticultural, nursery, or forest plantings of trees 
ef — shrubs cultivated land, forest plantations, 
ornamentals nurseries, orchards, or horticultural 
plantings in institutional, recreational, and residen- 
tial areas . 

Statutory Authority G.S. 143-444(1). 

TITLE 10 - DEPARTMENT OF HUMAN 
RESOURCES 

Notice is hereby given in accordance with G.S. 
150B-21 .2 that the Commission for Mental Health, 
Developmental Disabilities and Substance Abuse 
Services intends to adopt rule cited as 10 NCAC 
18L . 1525 and amend rules cited as 10 NCAC 14K 
.0103, .0314 - .0315; 140 .0106; 14Q .0106, 
.0303; 14R .0104 - .0105; 18J .0604; 18P .0903, 
.1003. 

1 he proposed effective date of this action is 
January 4, 1993. 

1 he public hearing will be conducted at 2:00 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1276 



PROPOSED RULES 



p.m. on November 13, 1992 at the Wilmington 
Hilton, North Water Street, Garden Room - Second 
Floor, Wilmington, N.C. 28401. 



MXeason for Proposed Action: 



10 NCAC 14K .0103, .0314, .0315 - Die pro- 
posed changes are to insert new language and new 
services into licensure requirements regarding 
early intervention to comply with changes in 34 
CFR 303. 12 (Federal Early Intervention Regula- 
tions). 

In October of 1991, P.L. 99-457 was reauthorized 
by Congress. Statutory changes resulted in revi- 
sions in the federal regulations, most of which 
involved terminology and clarification only; howev- 
er, one change involving a new service require- 
ment is transportation. 

10 NCAC 140 .0106 - Vie proposed change is to 
ensure the provider has all necessary information 
regarding the client, and that responsibilities for 
the provider are specified in the agreement. In 
addition, the proposed change is for consistency 
with same subject in other services regarding 
licensure requirements and client record documen- 
tation. 

10 NCAC 14Q .0303 - To ensure informed con- 
sent is obtained whenever a restrictive intervention 
is employed on a planned basis. 

10 NCAC 14R .0104 - To more clearly state in 
facility policy the required time frame for a review 
by a qualified professional whenever a restrictive 
intervention is used on a planned basis. 

10 NCAC 14R .0105 - To qualify which facilities 
are subject to review by the Client Rights Commit- 
tee. 



early intervention service without jeopardizing 
their right to receive other early intervention 
services. 

10 NCAC 18P .0903 - The proposed amendment 
is to delete the requirement for Division approval 
of written agreement. 

10 NCAC 18P .1003 - The proposed amendment 
is to delete the requirement for Division approval 
of written agreement, and to allow consistency 
with other similar Rules for exchange of informa- 
tion. 

Comment Procedures: Any interested person may 
present his comments by oral presentation or by 
submitting a written statement. Written comments 
must be sent to Charlotte Tucker, Division of 
Mental Health, Developmental Disabilities and 
Substance Abuse Services, 325 North Salisbury 
Street, Raleigh, North Carolina 27603 by Novem- 
ber 2, 1992 and must state the Rules to which the 
comments are addressed. Persons wishing to make 
oral presentations should contact Charlotte Tucker 
at 919-733-4774 by November 11, 1992. Time 
limits for oral remarks may be imposed by the 
Commission Chairman. Fiscal information on 
these Rules is available from the Division by 
request. 

CHAPTER 14 - MENTAL HEALTH: 
GENERAL 

SUBCHAPTER 14K - CORE LICENSURE 
RULES FOR MENTAL HEALTH: MENTAL 
RETARDATION AND OTHER DEVELOP- 
MENTAL DISABILITDZS: AND 
SUBSTANCE ABUSE FACILITIES 

SECTION .0100 - GENERAL INFORMA- 
TION 



10 NCAC 18J .0604 - 77zis Rule sets forth require- 
ments regarding State facility relationships for a 
facility which is area-operated or a contract 
agency. Tfie proposed change is to clarify the 
population served and to delete reference to re- 
gional director which no longer exists. Die pro- 
posed amendment will allow for consistency with 
other Rules. 

10 NCAC 18L .1525 - Die proposed adoption of 
this Rule will allow parents of a child, eligible to 
receive services, to accept or decline any type of 



.0103 DEFINITIONS 

(a) This Rule contains the definitions that apply 
to all the rules in this Subchapter and Subchapters 
14L through 140 of this Chapter. 

(b) In addition to the definitions contained in 
this Rule, the terms defined in G.S. 122C-3 also 
apply to all the rules in this Subchapter and Sub- 
chapters 14L through 140 of this Chapter. 

(c) The following terms shall have the meanings 
specified: 

(1) "Administering medication" means 
direct application of a drug to the body 



( 



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PROPOSED RULES 



> 



of a client by injection, inhalation, 
ingestion, or any other means. 

(2) "Adolescent" means a minor from 13 
through 17 years of age. 

(3) "Adult" means a person 18 years of age 
or older or a person under 18 years of 
age who has been married or who has 
been emancipated by a court of compe- 
tent jurisdiction or is a member of the 
armed forces. 

(4) "Aftercare" means those services pro- 
vided to substance abuse clients after 
discharge from a service which facili- 
tates the client's integration or reinte- 
gration into society. Activities may 
include self-help groups, supportive 
work programs and staff follow-up 
contacts and interventions. 

(5) "Alcohol abuse" means psychoactive 
substance abuse which is a residual 
category for noting maladaptive patterns 
of psychoactive substance use that have 
never met the criteria for dependence 
for that particular class of substance 
(criteria delineated in the 1987 edition 
of DSM-II1-R published by the Ameri- 
can Psychiatric Association, 1400 K 
Street, N.W., Washington, D.C. 20005 
at a cost of twenty-nine dollars and 
ninety-five cents ($29.95) for the soft 
cover edition and thirty-nine dollars and 
ninety-five cents ($39.95) for the hard 
cover edition.) This adoption by refer- 
ence does not include subsequent 
amendments and editions of the refer- 
enced material. 

(6) "Alcohol dependence" means psychoac- 
tive substance dependence which is a 
cluster of cognitive behavioral, and 
physiologic symptoms that indicate that 
a person has impaired control of psy- 
choactive substance use and continues 
use of the substance despite adverse 
consequences (criteria delineated in the 
1 987 edition of DSM-III-R published by 
the American Psychiatric Association, 
1400 K Street, N.W., Washington, 
D.C. 20005 at a cost of twenty-nine 
dollars and ninety-five cents ($29.95) 
for the soft cover edition and thirty-nine 
dollars and ninety-five cents ($39.95) 
for the hard cover edition.) This 
adoption by reference does not include 
subsequent amendments and editions of 
the referenced material. 



(7) "Applicant" means any person who 
intends to establish, maintain or operate 
a licensable facility and who applies to 
the Department for a license to operate 
a facility under the provisions of G.S. 
122C, Article 2. 

(8) "Approved supported employment 
conversion plan" means a planned 
approach to changing the type of servic- 
es delivered from ADAP facility-based 
to supported employment. Approval of 
the conversion plan is the responsibility 
of the Regional Director of the Division 
and the Area Director or his designee if 
the facility is operated by a contract 
agency of the area program or other 
service provider. The Division shall 
request appropriate personnel from the 
Division of Vocational Rehabilitation to 
participate in the review process. The 
request for approval of the supported 
employment conversion plan shall 
include specific written information in 
the following areas: 

(A) number of clients to be moved into 
supported employment placements; 

(B) types of supported employment mod- 
els to be used; 

(C) timeframe for the conversion period; 

(D) interim proposed facility staffing 
patterns and responsibilities; and 

(E) proposed budget for conversion plan. 

(9) "Area program" means a legally consti- 
tuted public agency providing mental 
health, mental retardation and substance 
abuse services for a catchment area 
designated by the Commission. For 
purposes of these Rules, the term "area 
program" means the same as "area 
authority" as defined in G.S. 122C-3. 

(10) "Assessment" means a procedure for 
determining the nature and extent of the 
problem for which the individual is 
seeking service. 

(11) "Atypical development" in children 
means those from birth to 60 months of 
age who demonstrate significantly 
atypical behavioral socioemotional, 
motor, or sensory development as 
manifested by: 

(A) Diagnosed hyperactivity, attention 
deficit disorder or other behavioral 
disorders, or 

(B) Identified emotional or behavioral 
disorders such as: 



7:13 NORTH CAROLINA REGISTER October I, 1992 



1278 



PROPOSED RULES 



(i) delay or abnormality in achieving 
expected emotional milestones, 
such as pleasurable interest in 
adults and peers; ability to com- 
municate emotional needs; and 
ability to tolerate frustrations, 
(ii) persistent failure to initiate or 
respond to most social interac- 
tions, 
(iii) fearfulness or other distress that 
does not respond to comforting by 
caregivers, 
(iv) indiscriminate sociability, e.g. 
excessive familiarity with relative 
strangers, 
(v) self-injurious or unusually aggres- 
sive behavior, or 
(C) Substantiated physical abuse, sexual 
abuse, or other environmental situa- 
tions that raise significant concern 
regarding the child's emotional 
well-being. 

(12) "Certified counselor" means an alcohol- 
ism, drug abuse or substance abuse 
counselor who is certified by the North 
Carolina Substance Abuse Professional 
Certification Board. 

(13) "Child" means a minor from birth 
through 12 years of age. 

(14) "Chronically mentally ill adult" means 
an individual 18 years of age or older 
who, as a result of a mental disorder, 
exhibits emotional or behavioral func- 
tioning which is so impaired as to 
interfere substantially with his capacity 
to remain in the community without 
supportive treatment or services of a 
long-term or indefinite duration. In 
these persons, mental disability is se- 
vere and persistent, resulting in 
long-term limitation of their functional 
capacities for primary activities of daily 
living such as interpersonal relations, 
homemaking, self-care, employment 
and recreation. 

( 15) "Client record" means a written account 
of all services provided a client from 
the time of admission of the client by 
the facility until discharge from the 
facility. 

(16) "Clinical" means having to do with the 
active direct treatment/habilitation of a 
client. 

(17) "Clinical staff member" means a pro- 
fessional who provides active direct 



treatment/habilitation to a client. 

(18) "Clinical/professional supervision" 
means regularly scheduled assistance by 
a qualified mental health professional, 
a qualified substance abuse professional 
or a qualified developmental disabilities 
professional to a staff member who is 
providing direct, therapeutic interven- 
tion to a client or clients. The purpose 
of clinical supervision is to ensure that 
each client receives appropriate treat- 
ment or habilitation which is consistent 
with accepted standards of practice and 
the needs of the client. 

(19) "Contested case" means an administra- 
tive proceeding under G.S. 150B, 
Article 3, in which the rights, privileg- 
es, or duties of a party are required by 
law to be determined. 

(20) "Contract agency" means a legally 
constituted entity with which the area 
program contracts for a service exclu- 
sive of intermittent purchase of service 
for an individually identified client. 

(21) "Day/night service" means a service 
provided on a regular basis, in a struc- 
tured environment that is offered to the 
same individual for a period of three or 
more hours within a 24-hour period. 

(22) "Declaratory ruling" means a formal 
and binding interpretation as to: 

(A) the validity of a rule; or 

(B) the applicability to a given state of 
facts of a statute administered by the 
Department of Human Resources, or 
a rule or order of the Department of 
Human Resources. 

(23) "Detoxification" means the physical 
withdrawal of an individual from alco- 
hol or other drugs in order that the 
individual can participate in rehabilita- 
tion activities. 

(24) "Developmentally delayed children" 
means those whose development is 
delayed in one or more of the following 
areas: cognitive development; physical 
development, including vision and 
hearing; language and speech; psycho 
s ocial communication, social and emo- 
tional and self help adaptive skills. The 
specific level of delay must be: 

(A) for children from birth to 36 months 
of age, documented by scores 1 Vz 
standard deviations below the mean 
on standardized tests in at least one of 



1279 



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PROPOSED RULES 



I 



> 



the above areas of development. Or, 
it may be documented by a 20 percent 
delay on assessment instruments that 
yield scores in months; and 
(B) for children from 36 to 60 months of 
age, documented by test performance 
two standardized deviations below the 
mean on standardized tests in one area 
of development or by performance 
that is one standard deviation below 
the norm in two areas of develop- 
ment. Or, it may be documented by 
a 25 percent delay in two areas on 
assessment instruments that yield 
scores in months. 

(25) "DFS" means the Division of Facility 
Services, 701 Barbour Drive, Raleigh, 
N.C. 27603. 

(26) "Direct care staff" means an individual 
who provides active direct care, treat- 
ment, or rehabilitation or habilitation 
services to clients. 

(27) "Dispensing medication" means prepar- 
ing and packaging a prescription drug 
or device in a container and labeling the 
container with information required by 
state and federal law. Filling or refill- 
ing drug containers with prescription 
drugs for subsequent use by a client is 
"dispensing". Providing quantities of 
unit dose prescription drugs for subse- 
quent administration is "dispensing". 

(28) "DMH/DD/SAS" means the Division of 
Mental Health, Developmental Disabili- 
ties, and Substance Abuse Services, 325 
N. Salisbury Street, Raleigh, N.C. 
27603. 

(29) "Documentation" means provision of 
written, dated and authenticated evi- 
dence of the delivery of client services 
or compliance with statutes or rules, 
e.g., entries in the client record, poli- 
cies and procedures, minutes of meet- 
ings, memoranda, reports, schedules, 
notices and announcements. 

(30) "Drug abuse" means psychoactive 
substance abuse which is a residual 
category for noting maladaptive patterns 
of psychoactive substance use that have 
never met the criteria for dependence 
for that particular class of substance 
(criteria delineated in the 1987 edition 
of DSM-III-R published by the Ameri- 
can Psychiatric Association, 1400 K 
Street, N.W., Washington, D.C. 20005 



at a cost of twenty-nine dollars and 
ninety-five cents ($29.95) for the soft 
cover edition and thirty-nine dollars and 
ninety-five cents ($39.95) for the hard 
cover edition.) This adoption by 
reference does not include subsequent 
amendments and editions of the refer- 
enced material. 

(31) "Drug dependence" means psychoactive 
substance dependence which is a cluster 
of cognitive behavioral, and physiologic 
symptoms that indicate that a person 
has impaired control of psychoactive 
substance use and continues use of the 
substance despite adverse consequences 
(criteria delineated in the 1987 edition 
of DSM-III-R published by the Ameri- 
can Psychiatric Association, 1400 K 
Street, N.W., Washington, D.C. 20005 
at a cost of twenty-nine dollars and 
ninety-five cents ($29.95) for the soft 
cover edition and thirty-nine dollars and 
ninety-five cents ($39.95) for the hard 
cover edition.) This adoption by 
reference does not include subsequent 
amendments and editions of the refer- 
enced material. 

(32) "DWI" means driving while impaired, 
as defined in G.S. 20-138.1. 

(33) "DWI substance abuse assessment" 
means a service provided to persons 
charged with or convicted of DWI to 
determine the presence of chemical 
dependency. The "assessment" in- 
volves a face-to-face interview with a 
substance abuse professional. 

(34) "Early Intervention Services" means 
those services provided for infants and 
toddlers specified in Section 303.12 of 
Subpart A of Part 303 of Title 34 of the 
Code of Federal Regulations, published 
6/22/89. For the purposes of these 
services, however, transportation means 
assistance in the travel to and from the 
multi-disciplinary evaluation, specified 
early intervention services provided by 
certified developmental day centers or 
other center-based services designed 
specifically for children with or at risk 
for disabilities; and speech, physical or 
occupational therapy, or other early 
intervention services if provided in a 
specialized setting away from the 
child's residence. Transportation assis- 
tance may be provided by staff, existing 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1280 



PROPOSED RULES 



public or private services or by the 
family, who shall be reimbursed for 
their expenses, in accordance with 
applicable fee provisions. This adop- 
tion by reference does not include 
subsequent amendments and editions of 
the referenced material. 

(35) "Evaluation" means an assessment 
service which identifies the nature and 
extent of an individual's problem 
through a systematic appraisal for the 
purposes of diagnosis and determination 
of the disability of the individual and 
the most appropriate plan, if any, for 
services. 

(36) "First aid" means emergency treatment 
for injury or sudden illness before 
regular medical care is available. First 
aid includes artificial respiration, the 
Heimlich maneuver, or other Red Cross 
first aid techniques for relieving airway 
obstruction, care of wounds and burns, 
and temporary administering of splints. 

(37) "Governing body" means, in the case of 
a corporation, the board of directors; in 
the case of an area authority, the area 
board; and in all other cases, the owner 
of the facility. 

(38) "Health Services" means those services 
provided for infants and toddlers speci- 
fied in Section 303.13 of Subpart A of 
Part 303 of Title 34 of the Code of 
Federal Regulations, published 6/22/89. 

This adoption by reference does not 
include subsequent amendments and 
editions of the referenced material. 

(39) "Hearing" means, unless otherwise 
specified, a contested case hearing 
under G.S. 150B, Article 3. 

(40) "High risk children" means those from 
birth to 36 months of age for whom 
there is clinical evidence of conditions 
which have a high probability of result- 
ing in developmental delay or atypical 
development and for whom there is 
clinical evidence that developmental or 
therapeutic intervention may be neces- 
sary. There are two categories of high 
risk children. These are: 

(A) High Risk-Established: Diagnosed or 
documented physical or mental condi- 
tions which are known to result in 
developmental delay or atypical devel- 
opment as the child matures. Such 
conditions are limited to the follow- 



ing: 

(i) chromosomal anomaly or genetic 
disorders associated with develop- 
mental deficits; 

(ii) metabolic disorders associated 
with developmental deficits; 

(iii) infectious diseases associated with 
developmental deficits; 

(iv) neurologic disorders; 

(v) congenital malformations; 

(vi) sensory disorders; or 

(vii) toxic exposure. 
(B) High Risk-Potential: Documented 
presence of indicators which are 
associated with patterns of develop- 
ment and which have a high probabili- 
ty of meeting the criteria for develop- 
mental delay or atypical development 
as the child matures. There shall be 
documentation of at least three of the 
parental or family, neonatal, or 
postneonatal risk conditions as defined 
on page 12 in the 1990 publication, 
"NORTH CAROLINA CHILD SER- 
VICE COORDINATION PRO- 
GRAM" available from the Division 
of Maternal and Child Health, Depart- 
ment of Environment, Health, and 
Natural Resources, PO Box 27687, 
Raleigh, NC 27611-7687. This 

adoption by reference does not in- 
clude subsequent amendments and 
editions of the referenced material. 
These conditions are as follows: 

(i) maternal age less than 15 years; 

(ii) maternal PKU; 

(iii) mother HIV positive; 

(iv) maternal use of anticonvulsant, 
antineoplastic or anticoagulant 
drugs; 

(v) parental blindness; 

(vi) parental substance abuse; 

(vii) parental mental retardation; 

(viii) parental mental illness; 

(ix) difficulty in bonding between 
parent and infant; 

(x) difficulty in providing basic 
parenting; 

(xi) lack of stable housing; 

(xii) lack of familial and social sup- 
port: 

(xiii) family history of childhood deaf- 
ness; 

(xiv) maternal hepatitis B; 

(xv) birth weight less than 1500 grams; 



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7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



> 



(xvi) gestational age less than 32 

weeks; 
(xvii) respiratory distress (mechanical 

ventilator greater than six hours); 
(xviii)asphyxia; 
(xix) hypoglycemia (less than 25 

mg/dl); 
(xx) hyperbilirubinemia (greater than 

20 mg/dl); 
(xxi) intracranial hemorrhage; 
(xxii) neonatal seizures; 
(xxiii)major congenital anomalies; 
(xxiv)CNS infection or trauma; 
(xxv) congenitally acquired infection; 
(xxvi)suspected visual impairment; 
(xxvii)suspected hearing impairment; 
(xxviii)no well child care by age six 

months; 
(xxix)failure on standard developmental 

or sensory screening test; 
(xxx) significant parental concern; and 
(xxxi)suspected abuse or neglect, who: 

(41) "Hours of operation" means an indica- 
tion of the minimum operational hours 
that a service is expected to be avail- 
able to clients, but not prohibiting the 
typical closing of a service to accom- 
modate holidays, vacations, staff devel- 
opment activities and weather and 
facility-related conditions but taking 
into consideration the type of service 
being provided. 

(42) "ICF/MR" (Intermediate Care Facili- 
ty/Mentally Retarded) means a facility 
certified as having met federal ICF/MR 
requirements and which provides 
24-hour personal care, habilitation, 
developmental and supportive services 
to persons with mental retardation or 
related conditions. 

(43) "Incident" means any happening which 
is not consistent with the routine opera- 
tion of the facility or the routine care of 
a client and that is likely to lead to 
adverse effects upon a client. 

(44) "Infant" means an individual from birth 
through two years of age. 

(45) "Legend drug" means a drug that can- 
not be dispensed without a prescription. 

(46) "License" means a permit to operate a 
facility which is issued by DFS under 
G.S. 122C, Article 2. 

(47) "Medication" means a substance recog- 
nized in the official "United States 
Pharmacopoeia" or "National Formu- 



lary" intended for use in the diagnosis, 
mitigation, treatment or prevention of 
disease. 

(48) "Minor client" means a person under 
1 8 years of age who has not been mar- 
ried or who has not been emancipated 
by a decree issued by a court of compe- 
tent jurisdiction or is not a member of 
the armed forces. 

(49) "Neighborhood" - See "residential 
setting". 

(50) "Nurse" means a person licensed to 
practice in the State of North Carolina 
either as a registered nurse or as a 
licensed practical nurse. 

(51) "Operator" means the designated agent 
of the governing body who is responsi- 
ble for the management of a licensable 
facility. 

(52) "Outpatient" or "Outpatient service" 
means the same as periodic service. 

(53) "Parent" means the legally responsible 
person unless otherwise clear from the 
context. 

(54) "Periodic service" means a service 
provided through short, recurring visits 
for persons who are mentally ill, devel- 
opmentally disabled or substance abus- 
ers. 

(55) "Physical examination" means the 
procedures used by a physician or 
physician extender on behalf of a physi- 
cian to determine the physiological and 
anatomical condition of the client. 
Physical examination also means medi- 
cal examination. 

(56) "Physician extender" means a nurse 
practitioner or a physician assistant 
approved to perform medical acts by 
the Board of Medical Examiners of the 
State of North Carolina. 

(57) "Preschool age child" means a child 
from three through five years of age. 

(58) "Private facility" means a facility not 
operated by or under contract with an 
area program. 

(59) "Program evaluation" means the sys- 
tematic documented assessment of 
program activity to determine the effec- 
tiveness, efficiency and scope of the 
system under investigation, to define its 
strengths and weaknesses and thereby to 
provide a basis for informed 
decision-making. 

(60) "Provider" means an individual, agency 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1282 



PROPOSED RULES 



or organization that provides mental 
health, mental retardation or substance 
abuse services. 

(61) "Psychiatric nurse" means an individual 
who is licensed to practice as a regis- 
tered nurse in the State of North Caroli- 
na by the North Carolina Board of 
Nursing and who is a graduate of an 
accredited master's level program in 
psychiatric mental health nursing with 
two years of experience, or has a 
master's degree in behavioral science 
with two years of supervised clinical 
experience, or has four years of experi- 
ence in psychiatric mental health nurs- 
ing. 

(62) "Psychiatric social worker" means an 
individual who holds a master's degree 
in social work from an accredited 
school of social work and has two years 
of clinical social work experience. 

(63) "Psychiatrist" means an individual who 
is licensed to practice medicine in the 
State of North Carolina and who has 
completed an accredited training pro- 
gram in psychiatry. 

(64) "Psychotherapy" means a form of 
treatment of mental illness or emotional 
disorders which is based primarily upon 
verbal or non-verbal communication 
with the patient. Treatment is provided 
by a trained professional for the pur- 
pose of removing or modifying existing 
symptoms, of attenuating or reversing 
disturbed patterns of behavior, and of 
promoting positive personality growth 
and development. 

(65) "Psychotropic medication" means medi- 
cation with the primary function of 
treating mental illness or personality or 
behavior disorders. These medications 
include, but are not limited to. 
antipsychotics. antidepressants, 
neuroleptics, lithium and minor tran- 
quilizers. 

(66) "Qualified alcoholism professional" 
means an individual who is certified by 
the North Carolina Substance Abuse 
Professional Certification Board or who 
is a graduate of a college or university 
with a baccalaureate or advanced de- 
gree in a human service related field 
with documentation of at least two 
years of supervised experience in the 
profession of alcoholism counseling. 



(67) "Qualified developmental disabilities 
professional" means an individual hold- 
ing at least a baccalaureate degree in a 
discipline related to developmental 
disabilities, and at least two years of 
supervised habilitative experience in 
working with the mentally retarded or 
otherwise developmentally disabled or 
holding a baccalaureate degree in a 
field other than one related to develop- 
mental disabilities and having three 
years of supervised experience in work- 
ing with the mentally retarded or other- 
wise developmentally disabled. 

(68) "Qualified drug abuse professional" 
means an individual who is certified by 
the North Carolina Substance Abuse 
Professional Certification Board or who 
is a graduate of a college or university 
with a baccalaureate or advanced de- 
gree in a human service related field 
with documentation of at least two 
years of supervised experience in the 
profession of drug abuse counseling. 

(69) "Qualified mental health professional" 
means any one of the following: psychi- 
atrist, psychiatric nurse, practicing 
psychologist, psychiatric social worker, 
an individual with at least a master's 
degree in a related human service field 
and two years of supervised clinical 
experience in mental health services or 
an individual with a baccalaureate 
degree in a related human service field 
and four years of supervised clinical 
experience in mental health services. 

(70) "Qualified nutritionist" means an indi- 
vidual who has a Master's degree in 
nutrition, nutrition education or public 
health nutrition and who may or may 
not be a registered dietitian. 

(71) "Qualified substance abuse profession- 
al" means an individual who is: 

(A) certified by the North Carolina Sub- 
stance Abuse Professional Certifica- 
tion Board; or 

(B) a graduate of a college or university 
with a baccalaureate or advanced 
degree in a human service related 
field with documentation of at least 
two years of supervised experience in 
the profession of alcoholism and drug 
abuse counseling. 

(72) "Registered dietitian" means an individ- 
ual who has successfully completed a 



1283 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



> 



national examination for the Commis- 
sion on Dietetic Registration and main- 
tains registration with that commission 
through approved continuing education 
activities and events. 

(73) "Rehabilitation" means training, care 
and specialized therapies undertaken to 
assist a client to reacquire or maximize 
any or all lost skills or functional abili- 
ties. 

(74) "Research" means inquiry involving a 
trial or special observation made under 
conditions determined by the investiga- 
tor to confirm or disprove a hypothesis, 
or to explicate some principle or effect. 
The term "research" as used in this 
document means research which is not 
standard or conventional; involves a 
trial or special observation which would 
place the subject at risk for injury 
(physical, psychological or social inju- 
ry), or increase the chance of disclosure 
of treatment; utilizes elements or steps 
not ordinarily employed by qualified 
professionals treating similar disorders 
of this population; or is a type of proce- 
dure that serves the purpose of the 
research only and does not include 
treatment designed primarily to benefit 
the individual. 

(75) "Residential setting" means a living 
area or zone in which the primary 
purpose is family residential living and 
which may be located in an area zoned 
either urban residential or rural. 

(76) "Respite discharge" means that point in 
time when no additional incidents of 
respite services are anticipated. 

(77) "Respite episode" means an uninterrupt- 
ed period of time during which a client 
receives respite services. 

(78) "Screening" means an assessment ser- 
vice which provides for a brief apprais- 
al of each individual who presents 
himself for services, in order to deter- 
mine the nature of the individual's 
problem and his need for services. 
Screening may also include referral to 
other appropriate community resources. 

(79) "Secretary" means the Secretary of the 
Department as defined in G.S. 122C-3. 

(80) "Service" means an activity or interac- 
tion intended to benefit another, with, 
or in behalf of, an individual who is in 
need of assistance, care, habilitation. 



intervention, rehabilitation or treatment. 

(81) "Severely physically disabled person" 
means for the purpose of ADAP (Adult 
Developmental Activity Program) a 
person: 

(A) who has a severe physical disability 
which seriously limits his functional 
capabilities (mobility, communication, 
self-care, self-direction, work toler- 
ance or work skills); 

(B) who has one or more physical disabil- 
ities resulting from amputation, arthri- 
tis, blindness, cancer, cerebral palsy, 
cystic fibrosis, deafness, heart dis- 
ease, hemiplegia, hemophilia, respira- 
tory or pulmonary dysfunction, multi- 
ple sclerosis, muscular dystrophy, 
musculoskeletal disorders, neurologi- 
cal disorders (including stroke and 
epilepsy), paraplegia, quadriplegia, 
and other spinal cord conditions, 
sickle cell anemia and end stage renal 
disease; and 

(C) whose habilitation or rehabilitation 
can be expected to require multiple 
habilitation or rehabilitation services 
over an extended period of time. 

(82) "Sheltered employment" means a 
facility's provision of work and work 
training by: 

(A) subcontracting from industries in the 
community and bringing work to the 
facility to be performed; or 

(B) manufacturing its own products in the 
facility. Clients served in a sheltered 
employment model are those who 
consistently achieve earning levels 
exceeding one-half of the minimum 
wage but who are not ready for inde- 
pendent employment activities. 

(83) "Staff member" means any individual 
who is employed by the facility. 

(84) "Substantially mentally retarded person" 
means for the purpose of ADAP a 
person who is mentally retarded to the 
degree of seriously limiting his func- 
tional capabilities, whose habilitation or 
rehabilitation can be expected to extend 
over a period of time, and including: 

(A) moderately mentally retarded persons; 

(B) severely mentally retarded persons; 

(C) profoundly mentally retarded persons; 
or 

(D) mentally retarded persons with a 
handicapping condition so severe as to 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1284 



PROPOSED RULES 



lack the potential for employment at 
this time, either in a sheltered or 
competitive setting. In addition, such 
individuals must have a deficit in 
self-help, communication, socializa- 
tion or occupational skills and be 
recommended by the vocational reha- 
bilitation counselor for consideration 
of placement in an ADAP. 

(85) "Support services" means services 
provided to enhance an individual's 
progress in his primary treat- 
ment/habilitation program. 

(86) "Supported employment" means a 
day/night service which involves paid 
work in a job which would otherwise 
be done by a non-disabled worker. 
Supported employment is carried out in 
an integrated work site where a small 
number of people with disabilities work 
together and where the work site is not 
immediately adjacent to another pro- 
gram serving persons with disabilities. 
It includes intensive involvement of 
staff working with the individuals in 
these integrated settings. 

(87) "Toddler" means an individual from 
one through three years of age. 

(88) "Treatment" means the process of 
providing for the physical, emotional, 
psychological and social needs of cli- 
ents through services. 

(89) "Treatment; habilitation plan" means a 
plan in which one or more profession- 
als, privileged in accordance with 10 
NCAC 14K .0319, working with the 
client and, in some cases, family mem- 
bers or other service providers, docu- 
ment which interventions will be pro- 
vided and the goals, objectives and 
strategies that will be followed in pro- 
viding services to the client. 

(90) "Twenty-four hour facility in which 
medical care is an integral component" 
means a facility in which: 

(A) the medication needs of clients may 
be evaluated, medication prescribed 
and laboratory tests ordered to assist 
in the diagnosis, treatment and moni- 
toring of problems associated with the 
mental health, mental retardation or 
other developmental disabilities or 
substance abuse disorder of clients; 
and 

(B) proper referral of the client is made to 



medical specialists when needed. 
(91) "Twenty-four hour service" means a 
service which is provided to a client on 
a 24-hour continuous basis. 



Statutory Authority G.S. 
143B-147. 



122C-3; 122C-26; 



SECTION .0300 - FACILITY AND PRO- 
GRAM MANAGEMENT 

.0314 ASSESSMENT 

(a) The governing body shall develop and 
implement written policies regarding admission 
assessments for clients in each facility. 

(b) Each facility shall complete an initial admis- 
sion assessment for each client prior to the deliv- 
ery of treatment/habilitation services. The initial 
assessment shall include: 

(1) the presenting problem or reason for 
admission; 

(2) the client's needs and strengths, and 
when appropriate, the needs and 
strengths of family members who may 
contribute to the services provided to 
the client; 

(3) a provisional or admitting diagnosis 
with an established diagnosis deter- 
mined within 30 days of admission, 
except for clients admitted to a detoxifi- 
cation or other 24-hour medical pro- 
gram for any length of time, who shall 
have an established diagnosis upon 
admission; 

(4) a description of current status including 
the following, when applicable: 

(A) mental status, including suicide poten- 
tial; 

(B) developmental condition or impair- 
ment; 

(C) substance use or abuse; 

(D) legal status or circumstances; 

(E) medical condition; and 

(F) family and other support systems; 

(5) a description of the client's condition 
from family or significant others, when 
available; and 

(6) the disposition, including referrals and 
recommendations. 

(c) Data gathered during a screening or from 
other sources within 30 days prior to admission 
may be used to complete the assessment. 

(d) For a client expected to receive services for 
more than 30 days, the admission assessment shall 
include the following within 30 days of admission: 



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PROPOSED RULES 






i 



(1) a social and family history; 

(2) a medical history; and 

(3) when applicable, histories and assess- 
ments as follows: 

(A) psychiatric, including previous treat- 
ment; 

(B) substance abuse, including previous 
treatment; 

(C) developmental, including previous 
services received; 

(D) educational; 

(E) auditory and visual; 

(F) nutritional; and 

(G) vocational. 

(e) For all facilities serving infants and toddlers 
with or at risk for developmental disabilities, 
delays or atypical development, except for respite, 
there shall be: 

(1) an assessment of levels of physical, 
(including vision and hearing), language 
and speech, communication, cognitive, 
psychosocial social and emotional and 
self help adaptive skills development; 

(2) a determination of the child's unique 
strengths and needs in terms of these 
areas of development and identification 
of services appropriate to meet those 
needs; 

(3) if requested by the family, a determina- 
tion of the strength s and needs of the 
family related to enhancing the develop 
ment of the child, of the resources, 
priorities and concerns of the family, 
and the supports and services necessary 
to enhance the family's capacity to meet 
the developmental needs of their infant 
or toddler with or at risk for a disabili- 
ty. The family - focused and directed 
assessment shall be based on informa- 
tion provided through a personal inter- 
view and incorporate the family's de- 
scription of the strengths and needs; 
these resources, priorities, and concerns 
in this area; 

(4) procedures developed and implemented 
to ensure participation by the client's 
family or the legally responsible per- 
son; 

(5) tests and other evaluation materials and 
procedures administered in the native 
language of the parents or other mode 
of communication unless it is clearly 
not feasible to do so; 

(6) assessment procedures and materials 
which are selected and administered so 



as not to be racially or culturally dis- 
criminatory; 

(7) no single procedure used as the sole 
criterion for determining a child's 
eligibility; 

(8) an integrated assessment process which 
involves at least two persons, each 
representing a different discipline or 
profession, with the specific number 
and types of disciplines based on the 
particular needs of the child; : — One of 
the disciplines shall include a physician, 
phy s ician' s a s si s tant or nurse practitio 
ncr, 

(A) The assessment shall include current 
medical information provided by a 
physician, physician's assistant, or 
nurse practitioner; however, a physi- 
cian, physician's assistant, or nurse 
practitioner is not required as one of 
the disciplines involved in the assess- 
ment; and 

(B) Further information regarding the 
assessment may be found in the docu- 
ment "Eligibility Determination for 
the Infants-Toddler Program", pub- 
lished by the Department of Environ- 
ment, Health, and Natural Resources. 



(9) 
(10) 



(A) 
(B) 



(C) 
(D) 
(E) 



an evaluation process based on in- 
formed clinical opinion; 
an assessment process completed within 
45 calendar days from the date of refer- 
ral. The referral is initiated by a writ- 
ten request for these services made to 
any one of the public agencies partici- 
pating in the PL 99-457 Interagency 
Agreement. The request becomes a 
referral when the area program deter- 
mines that all of the following is avail- 
able: 
the family's written consent to receive 
this service; 

sufficient background information to 
enable the agency receiving the refer- 
ral to establish communication 
through a telephone call or home 
visit; 

reason for referral, date of referral 
and agency or individual making 
referral ; 

child and family identifying informa- 
tion such as names, child's birthdate 
and primary physician; and 
summary of any pre-existing child and 
family screening or assessment infor- 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1286 



PROPOSED RULES 



mation; 

(11) a 45 calendar day completion require- 
ment which may be extended in excep- 
tional circumstances, such as, the 
child's health assessment is being com- 
pleted out-of-state, or family desires 
make it impossible to complete the 
assessment within the time period. The 
specific nature and duration of these 
circumstances which prevent completion 
within 45 days and the attempts made 
by the provider to complete the assess- 
ment shall be documented; and 

( 12) the child's family or legally responsible 
person shall be fully informed of the 
results of the assessment process. 

Statutory Authority G.S. 122C-26; 130 A- 144; 
130A-152; 143B-147. 

.0315 TREATMENT/HABILITATION 
PLANNING AND 
DOCUMENTATION 

(a) The governing body shall develop and 
implement written policies regarding individual 
treatment/habilitation plans and the qualifications 
of staff, based on education and experience, who 
will be responsible for implementation of such 
plans. 

(b) A treatment/habilitation plan shall be based 
upon an assessment of the client's condition, assets 
and needs, and the resources to meet these needs, 
and shall be developed in partnership with the 
client. 

(c) The parent or the legally responsible person 
of a minor shall have the opportunity to participate 
in the development and implementation of the 
minor client's individual treatment/ habilitation 
plan. 

(d) The parent, with client consent, or the 
legally responsible person of an adult shall have 
the opportunity to participate in the development 
and implementation of the adult client's individual 
treatment/habilitation plan. 

(e) Clinical responsibility for the development 
and implementation of the treatment/habilitation 
plan shall be designated. 

(f) Initial treatment/habilitation objectives shall 
be documented, if services are to be provided, 
prior to the establishment and implementation of 
the comprehensive treatment/habilitation plan. 

(g) Except as provided in Paragraphs (h) 
through (j) of this Rule, a comprehensive plan 
shall be developed and initiated within 30 days of 
admission for clients who are expected to receive 



services from the facility beyond 30 days. The 
plan shall include, as appropriate to the client's 
needs: 

(1) documentation of the established diag- 
nosis; 

(2) time-specific, measurable goals for 
treatment/habilitation; 

(3) general strategies or procedures to be 
undertaken in order to meet goals and 
the direct care staff responsible for 
implementation; 

(4) time-specific, measurable education or 
treatment goals for family or significant 
others, if applicable; and 

(5) a schedule for time-specific planned 
reviews, which may be set, in addition 
to those required in Paragraph (k) of 
this Rule. 

(h) For all facilities serving infants and toddlers 

with or at risk for developmental disabilities, 

delays or atypical development, except for respite: 

(1) there shall be a habilitation plan which 

is referred to as the Individualized 

Family Service Plan (IFSP) which shall 

include: 

(A) a description of the child's present 
health status and levels of physical 
(including vision and hearing), ten- 
guage — and s peech, communication. 
cognitive, psychosocial, social and 
emotional, and self help skills adap- 
tive development; 

(B) with the concurrence of the family, a 
description of the family' s strengths 
and needs — related to enhancing the 
development of the child; the resourc- 
es, priorities and concerns of the 
family and the supports and services 
necessary to enhance the family's 
capacity to meet the developmental 
needs of their infant and toddler with 
or at risk for a disability; 

(C) goals for the child, and, if requested, 
goals for the child's family; 

(D) criteria and time frames to be used to 
determine progress towards goals; 

(E) planned habilitation procedures related 
to the goals; 

(F) a statement of the specific early inter- 
vention services to be provided to 
meet the identified child and family 
needs, the initiation dates, frequency 
and method, duration, intensity and 
location (including the most natural 
environment) of service delivery, and 



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PROPOSED RULES 



the persons or agencies responsible; 

(G) the designation of the staff member 
responsible for service coordination; 

(H) the plans for transition into services 
which are the responsibility of the 
N.C. Department of Public Instruc- 
tion, when applicable; 

(I) the payment arrangements for the 
specific services delineated in Sub- 
paragraph (h)(1)(F) of this Rule; 

(J) a description of medical and other 
services needed by the child, but 
which are not required under P.L. 
99-457, and the strategies to be pur- 
sued to secure those services through 
public or private resources. 

(2) The IFSP shall be: 

(A) reviewed on at least a semi-annual 
basis or more frequently upon the 
family's request; and 

(B) revised as appropriate, but at least 
annually. 

(3) The initial development and annual 
revision process for the IFSP for infants 
and toddlers shall include participation 
by: 

(A) the parent or parents of the child; 

(B) other family members, as requested 
by the parent; 

(C) an advocate or person outside of the 
family if the parent requests that the 
person participate; 

(D) the provider of the early intervention 
services; 

(E) the service coordinator designated for 
the family, if different from the pro- 
vider of the early intervention servic- 
es; and 

(F) the provider of the assessment ser- 
vice, if different from the provider of 
the early intervention services. 

(4) The IFSP review shall be arranged and 
written notice provided to families early 
enough to promote maximum opportu- 
nities for attendance. The semi-annual 
review process shall include participa- 
tion by persons identified in Subpara- 
graphs (h)(3)(A) through (E) of this 
Rule. If any of these individuals are 
unable to attend one of the development 
or review meetings, arrangements shall 
be made for the person's involvement 
through other means such as participa- 
tion in a telephone conference call, 
having a knowledgeable authorized 



representative attend the meeting or 
making pertinent records available at 
the meeting. 

(5) The IFSP for infants and toddlers is 
based upon the results of the assessment 
referenced in 10 NCAC 14K .0314(e). 
However, early intervention services 
may commence before completion of 
this assessment if parental consent is 
obtained, the assessment is completed 
within the time period referenced in 10 
NCAC 14K .0314(e), and an interim 
IFSP is developed. The interim IFSP 
shall include: 

(A) the name of the service coordinator 
who will be responsible for the imple- 
mentation of the IFSP and coordina- 
tion with other agencies and individu- 
als; 

(B) goals for the child and family when 
recommended; 

(C) those early intervention services that 
are needed immediately; and 

(D) suggested activities that may be car- 
ried out by the family members. 

(6) Each facility or individual who has a 
direct role in the provision of early 
intervention services specified in the 
IFSP is responsible for making a good 
faith effort to assist each eligible child 
in achieving the goals set forth in the 
IFSP. 

(7) The IFSP shall be developed within 45 
days of referral for those children 
determined to be eligible. The referral 
shall be as defined in 10 NCAC 14K 
.0314(e)(ll). 

£8) The contents of the IFSP must be fully 
explained to the parents, and informed 
written consent from the parents must 
be obtained prior to the provision of 
early intervention services described in 
the plan. If the parents do not provide 
consent with respect to a particular 
early intervention service, that service 
may not be provided. The early inter- 
vention services to which parental 
consent is obtained must be provided. 
(i) The goals for a client who receives services 
from facilities providing day activity or alternative 
family living, half-way house, therapeutic camp or 
group home services in which the supervision and 
therapeutic intervention are limited to sleeping 
time, home living skills and leisure time activities, 
may be limited to life-skill, social or recreational 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1288 



PROPOSED RULES 



goals. 

(j) The goals for a client who receives services 
from a community respite facility may be limited 
to the special needs of the client, including medi- 
cations to be administered, dietary considerations 
and expectations regarding other services. 

(k) A full review of each client's treat- 
ment/habilitation plan shall be conducted at least 
annually by the responsible professional in accor- 
dance with the facility's quality assurance plan, as 
determined by 10 NCAC 14K .0319. The review 
shall include: 

( 1 ) the client's continuing need for service; 
and 

(2) a continuation or update of the client's 
treatment/habilitation plan as defined in 
Paragraph (g) of this Rule. 

Statutory Authority G.S. 122C-26: 143B-147. 

SUBCHAPTER 140 - LICENSURE RULES 

FOR FACILITIES SERVING MORE THAN 

ONE DISABILITY 

SECTION .0100 - ALTERNATIVE FAMILY 
LIVLNG 

.0106 SERVICE RESPONSIBILITIES 

(a) When the governing body is not the provider 
of services, it shall attempt to match the client's 
needs with the provider. 

(b) Each governing body shall maintain an 
application on each provider which includes the 
following: 

(1) full name of each person living in the 
facility: 

(2) place, telephone number and hours of 
employment for those family members 
who will be providing alternative family 
living services; 

(3) address, directions to and telephone 
number of residence; and 

(4) descriptions of sleeping arrangements 
for the client. 

(c) Each governing body shall have a written 
agreement with each provider which includes but 
is not limited to the following: 

(1) the responsibility of the provider; 

(2) confidentiality requirements; and 

(3) responsibility and procedures for secur- 
ing emergency services. 

(d) Information regarding the client's specific 
needs or conditions shall be given to the provider 
prior to admission. 

(e) The governing body shall maintain a signed 



copy of the agreement in the files, and a A signed 
copy of the agreement shall be given to the provid- 
er. 

(f) Each governing body shall furnish each 
provider with a form for recording illness, acci- 
dent or medical concerns, including administration 
of medication. This form shall be maintained by 
the governing body in the client's record. 

Statutory Authority G.S. 122C-26; 143B-147. 

SUBCHAPTER 14Q - GENERAL RIGHTS 

SECTION .0300 - GENERAL CIVIL, LEGAL 
AND HUMAN RIGHTS 

.0303 INFORMED CONSENT 

(a) Each client, or legally responsible person, 
shall be informed about: 

(1) the alleged benefits, potential risks, and 
possible alternative methods of treat- 
ment/habilitation; and 

(2) the length of time for which the consent 
is valid and the procedures that are to 
be followed if he chooses to withdraw 
consent. The length of time for a 
consent for the planned use of a restric- 
tive intervention shall not exceed six 
months. 

(b) A consent required in accordance with G.S. 
122C-57(f) or for planned interventions by the 
Rules in Subchapter 14R. Section .0100. shall be 
obtained in writing. Other procedures requiring 
written consent shall include, but are not limited 
to, the prescription or administration of the follow- 
ing drugs: 

( 1 ) Antabuse; and 

(2) Depo-Provera when used for non-FDA 
approved uses. 

(c) Each voluntary client or legally responsible 
person has the right to consent or refuse 
treatment/habilitation in accordance with G.S. 
122C-57(d). A voluntary client's refusal of con- 
sent shall not be used as the sole grounds for 
termination or threat of termination of service 
unless the procedure is the only viable treat- 
ment/habilitation option available at the facility. 

(d) Documentation of informed consent shall be 
placed in the client's record. 

Statutory Authority G.S. 122C-51; 122C-57; 
131E-67; 143B-147. 

SUBCHAPTER 14R - TREATMENT OR 
HABILITATION RIGHTS 



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PROPOSED RULES 



SECTION .0100 - PROTECTIONS REGARD- 
ING INTERVENTION PROCEDURES 

.0104 SECLUSION, RESTRAINT AND 
ISOLATION TIME OUT 

(a) This Rule governs the use of restrictive 
interventions which shall include: 

(1) seclusion: 

(2) physical restraint, excluding protective 
devices; and 

(3) isolation time-out. 

(b) The use of restrictive interventions shall be 
limited to: 

(1) emergency situations, in order to termi- 
nate a behavior or action in which a 
client is in imminent danger of abuse or 
injury to self or other persons or when 
substantial property damage is occur- 
ring; or 

(2) as a planned measure of therapeutic 
treatment as specified in Paragraph (g) 
of this Rule. 

(c) Restrictive interventions shall not be em- 
ployed as retaliation or for the convenience of 
staff. Restrictive interventions shall not be used in 
a manner that causes harm or abuse. 

(d) In accordance with Rule .0101 of Subchapter 
14Q, the governing body shall have policy that 
delineates the permissible use of restrictive inter- 
ventions within a facility. 

(e) Within a facility where restrictive interven- 
tions may be used, the policy and procedures shall 
be in accordance with the provisions of Subpara- 
graph (1) or (2) of this Paragraph. 

(1) The governing body of the facility may 
develop its own policy. Such policy 
and facility procedures shall be submit- 
ted to and approved by the Commission 
and shall ensure: 

(A) timely notice and explanations to the 
person who is legally responsible; 

(B) valid opportunities to consent to or 
refuse planned interventions; 

(C) the intervention is justified, properly 
time-limited, and that appropriate 
positive and less restrictive alterna- 
tives are thoroughly, systematically 
and continuously considered and used; 

(D) when the restrictive intervention is 
used on a recurring or planned basis, 
it will be incorporated into a treat- 
ment/habilitation plan; 

(E) implementation by trained staff, close- 
ly supervised by a qualified profes- 
sional; 



(F) manner, conditions and location of the 
intervention are safe and humane; 

(G) implementation is monitored and the 
monitoring results are disseminated to 
assure follow-through, continuing 
justification and timely adjustment to 
meet changing circumstances; and 

(H) that the safeguards in this Rule are 
documented. 
(2) If the governing body chooses not to 
develop its own policy, facility policy 
shall include provisions that specify: 

(A) the process for identifying and privi- 
leging facility employees who may 
authorize and implement restrictive 
interventions; 

(B) the duties and responsibilities of 
qualified or responsible professionals 
regarding the use of restrictive inter- 
ventions; 

(C) the person responsible for documenta- 
tion when restrictive interventions are 
used; 

(D) the person responsible for the notifi- 
cation of others when restrictive 
interventions are used; and 

(E) the person responsible for the identifi- 
cation of a client with a reasonably 
foreseeable physical consequence to 
the use of physical restraint and, in 
such cases there shall be procedures 
regarding: 

(i) documentation if a client with 
physical disability or past surgical 
procedures that would make af- 
fected nerves and bones sensitive 
to injury; and 
(ii) the identification and documenta- 
tion of alternative emergency 
procedures, if needed. 
(f) If the governing body chooses to comply 
with Subparagraph (e)(2) of this Rule, the follow- 
ing provisions shall be applicable: 

(1) Any room used for seclusion or isola- 
tion time-out shall meet the following 
criteria: 

(A) the room shall be designed and con- 
structed to ensure the health, safety 
and well-being of the client; 

(B) the floor space shall not be less than 
50 square feet, with a ceiling height 
of not less than eight feet; 

(C) the floor and wall coverings, as well 
as any contents of the room, shall 
have a one-hour fire rating and shall 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1290 



PROPOSED RULES 



not produce toxic fumes if burned; 

(D) the walls shall be kept completely free 
of objects; 

(E) a lighting fixture, equipped with a 
minimum of a 75 watt bulb, shall be 
mounted in the ceiling and be 
screened to prevent tampering by the 
client; 

(F) one door of the room shall be 
equipped with a window mounted in a 
manner which allows inspection of the 
entire room; 

(G) glass in any windows shall be impact 
resistant and shatterproof; 

(H) the room temperature and ventilation 
shall be comparable and compatible 
with the rest of the facility; and 

(I) in a lockable room the lock shall be 
interlocked with the fire alarm system 
so that the door automatically unlocks 
when the fire alarm is activated if the 
room is to be used for seclusion. 

(2) Whenever a restrictive intervention is 
utilized, documentation shall be made 
in the client record to include, at a 
minimum: 

(A) notation of the frequency, intensity 
and duration of the behavior which 
led to the intervention, and any pre- 
cipitating circumstance contributing to 
the onset of the behavior; 

(B) the rationale for the use of the inter- 
vention, which also addresses the 
inadequacy of less restrictive interven- 
tion techniques; 

(C) a description of the intervention and 
the date, time and duration of its use; 

(D) a description of accompanying posi- 
tive methods of intervention; and 

(E) signature and title of the facility em- 
ployee who initiated, and of the em- 
ployee who further authorized, the 
use of the intervention. 

(3) The emergency use of restrictive inter- 
ventions shall be limited, as follows: 

(A) a facility employee privileged to 
administer emergency interventions 
may employ such procedures for up 
to 15 minutes without further authori- 
zation; 

(B) the continued use of such interven- 
tions shall be authorized only by the 
responsible professional or another 
qualified professional who is privi- 
leged to use the restrictive interven- 



tion based on experience and training; 

(C) the responsible or qualified profes- 
sional shall meet with and conduct an 
assessment of the client and write a 
continuation authorization as soon as 
possible after the time of initial em- 
ployment of the intervention. If the 
responsible professional or a qualified 
professional is not immediately avail- 
able to conduct an assessment of the 
client, but concurs that the interven- 
tion is justified after discussion with 
the facility employee, continuation of 
the intervention may be verbally 
authorized until an on-site assessment 
of the client can be made; and 

(D) a verbal authorization shall not exceed 
24 hours after the time of initial 
employment of the intervention. 

(4) The following precautions and actions 
shall be employed whenever a client is 
in: 

(A) seclusion or physical restraint, exclud- 
ing protective devices: periodic 
observation of the client shall occur at 
least every 15 minutes, or more often 
as necessary, to assure the safety of 
the client; appropriate attention shall 
be paid to the provision of regular 
meals, bathing, and the use of the 
toilet; and such observation and atten- 
tion shall be documented in the client 
record. 

(B) isolation time-out; there shall be a 
facility employee in attendance with 
no other immediate responsibility than 
to monitor the client who is placed in 
isolation time-out; there shall be 
continuous observation and verbal 
interaction with the client when ap- 
propriate; and such observation shall 
be documented in the client record. 

(C) physical restraint, excluding protec- 
tive devices, and the client may be 
subject to injury: a facility employee 
shall remain present with the client 
continuously. 

(5) The use of a restrictive intervention 
shall be discontinued as soon as thera- 
peutically appropriate but in no case 
later than 30 minutes after the client 
gains behavioral control. If the client is 
unable to gain behavioral control within 
the time frame specified in the authori- 
zation of the intervention, a new autho- 



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7:13 NORTH CAROLINA REGISTER October 1, 1992 






PROPOSED RULES 



\ 



rization must be obtained. 

(6) The written approval of the designee of 
the governing body shall be required 
when a restrictive intervention is uti- 
lized for longer than 24 continuous 
hours. 

(7) The use of a restrictive intervention in 
excess of 24 continuous hours shall be 
considered a restriction of the client's 
rights as specified in G.S. 122C-62(b) 
or (d). The documentation require- 
ments in this Rule shall satisfy the 
requirements specified in G.S. 
122C-62(e) for rights restrictions. 

(8) When any restrictive intervention is 
utilized for a client, notification of 
others shall occur as follows: 

(A) those to be notified as soon as possi- 
ble but no more than 72 hours after 
the behavior has been controlled to 
include: 

(i) the treatment or habilitation team, 
or its designee, after each use of 
the intervention; and 

(ii) a designee of the governing body. 

(B) in a timely fashion, of the legally 
responsible person of a minor client 
or an incompetent adult client when 
such notification has been requested. 

(9) The facility shall conduct reviews and 
reports on any and all use of restrictive 
interventions, including: 

(A) a regular review by a designee of the 
governing body; 

(B) an investigation of any unusual or 
possibly unwarranted patterns of 
utilization; and 

(C) documentation of the following shall 
be maintained on a log: 

(i) name of the client; 
(ii) name of the responsible profes- 
sional; 
(iii) date of each intervention; 
(iv) time of each intervention; 
(v) type of intervention; 
(vi) duration of each intervention; and 
(vii) reason for use of the intervention. 
(10) Nothing in this Rule shall be interpreted 
to prohibit the use of voluntary restric- 
tive interventions at the client's request; 
however, the procedures in this Rule 
shall apply with the exception of Sub- 
paragraph (f)(3) of this Rule. 
(g) The restrictive intervention shall be consid- 
ered a planned intervention and shall be included 



in the client's treatment/habilitation plan whenever 
it is used: 

(1) more than four times, or for more than 
40 hours, in 30 consecutive days; 

(2) in a single episode for 24 or more 
continuous hours in an emergency; or 

(3) as a measure of therapeutic treatment 
designed to reduce dangerous, aggres- 
sive, self-injurious, or undesirable 
behaviors to a level which will allow 
the use of less restrictive treatment or 
habilitation procedures. 

(h) When a restrictive intervention is used as a 
planned intervention, facility policy shall specify: 

(1) The requirement that a consent or 
approval shall be considered valid for 
no more than six months and that the 
decision to continue the specific inter- 
vention shall be based on clear and 
recent behavioral evidence that the 
intervention is having a positive impact 
and continues to be needed; 

(2) Prior to the initiation or continued use 
of any planned intervention, the follow- 
ing written notifications, consents and 
approvals shall be obtained and docu- 
mented in the client record: 

(A) approval of the plan by the responsi- 
ble professional and the treatment and 
habilitation team, if applicable, shall 
be based on an assessment of the 
client and a review of the documenta- 
tion required by Subparagraph 
(e)(1)(H) or (f)(2) of this Rule, which- 
ever is applicable; 

(B) consent of the client or legally respon- 
sible person, after the specific inter- 
vention and the reason for it have 
been explained in accordance with 10 
NCAC 14Q .0201; 

(C) notification of a client advocate that 
the specific intervention has been 
planned for the client and the ratio- 
nale for utilization of the intervention; 
and 

(D) physician approval, after an initial 
medical examination, when the plan 
includes a specific intervention with 
reasonably foreseeable physical conse- 
quences. In such cases, periodic 
planned monitoring by a physician 
shall be incorporated into the plan. 

(3) Within 30 days of initiation of the use 
of a planned intervention, the Interven- 
tion Advisory Committee established in 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1292 



PROPOSED RULES 



accordance with Rule .0107 of this 
Section, by majority vote, may recom- 
mend approval or disapproval of the 
plan or may abstain from making a 
recommendation; 

(4) At any time during the use of a planned 
intervention, if requested, the Interven- 
tion Advisory Committee shall be given 
the opportunity to review the treat- 
ment/habilitation plan; 

(5) If any of the persons or committees 
specified in Subparagraphs (h)(2) or (3) 
of this Rule do not approve the initial 
use or continued use of a planned inter- 
vention, the intervention shall not be 
initiated or continued. Appeals regard- 
ing the resolution of any disagreement 
over the use of the planned intervention 
shall be handled in accordance with 
governing body policy; 

(6) Documentation in the client record 
regarding the use of a planned interven- 
tion shall indicate: 

(A) the weekly evaluation of the planned 
intervention by staff who implement 
the intervention; and 

(B) the — bi weekly review.^ every two 
weeks, by a qualified professional. 



(4) protective devices are cleaned at regular 
intervals; and 

(5) for facilities operated by or under con- 
tract with an area program, the utiliza- 
tion of protective devices in the treat- 
ment/habilitation plan shall be subject 
to review by the Client Rights Commit- 
tee, as required in JO NCAC 18L 

0434. Copies of this Rule and other 
pertinent Rules are published as Divi- 
sion publication STANDARDS FOR 
AREA PROGRAMS AND THEIR 
CONTRACT AGENCIES, APSM 35- 1 , 
and may be purchased at a cost of six 
dollars ($6.00) per copy, if there is 

(b) The use of any protective device for the 
purpose or with the intent of controlling unaccept- 
able behavior shall be considered a mechanical 
restraint and shall comply with the requirements of 
Rule .0104 of this Section. 



Statutory Authority G.S. 122C-51; 
122C-60; 131E-67; 143B-147. 



122C-53; 



CHAPTER 18 MENTAL HEALTH: OTHER 
PROGRAMS 



Statutory Authority G.S. 122C-51; 122C-53; 
122C-60; 122C-62; 131E-67: 143B-147. 



SUBCHAPTER 18J - AREA PROGRAM 
MANAGEMENT STANDARDS 



.0105 PROTECTIVE DEVICES 

(a) Whenever a protective device is utilized for 
a client, the governing body shall develop and 
implement policy to ensure that: 

( 1 ) the necessity for the protective device 
has been assessed and the device ap- 
plied by a facility employee who has 
been trained and privileged in the utili- 
zation of protective devices; 

(2) the protective device is the least restric- 
tive appropriate measure; 

(3) the client is frequently observed and 
provided opportunities for toileting, 
exercise, etc. as needed. When a pro- 
tective device limits the client's free- 
dom of movement, the client shall be 
observed at least every hour. Whenev- 
er the client is restrained and subject to 
injury by another client, a facility em- 
ployee shall remain present with the 
client continuously. Observations and 
interventions shall be documented in the 
client record; 



SECTION .0600 - STATE FACILITY 
RELATIONSHIPS 

.0604 RESIDENTIAL POPULATION: 
GROUP HOMES FOR MR/ 
DP ADULTS 

(a) Each area program shall assure that at least 
one-half of the total resident population of all 
group homes for mentally retard- 
ed /developmentally disabled adults in its catchment 
area is comprised of individuals who immediately 
prior to their admission to a group home for 
mentally retarded /developmentally disabled adults 
were: 

(1) residents of a state mental retardation 
center, a state psychiatric hospital, a 
group home for children who are men- 
tally retarded /developmentally disabled . 
a specialized community residential 
center for children who are mentally 
retarded, a group home for individuals 
who are mentally retarded and 
behaviorally disordered, or a certified 



1293 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



ICF/MR facility; 

(2) continuity of care clients as defined in 
G.S. 122C-63; or 

(3) clients who had been processed and 
approved for admission to a state facili- 
ty- 

(b) The area program may be exempt from the 

requirements in Paragraph (a) of this Rule if it is 
determined and approved in writing by the 
Division's Chief of Developmental Disabilities 
appropriate regional director that there is not a 
sufficient number of clients within the catchment 
area who fall within the categories listed in Para- 
graph (a) of this Rule to enable the area program 
to comply with the requirements of this Rule. 

(c) Each area program shall maintain a written 
record indicating which clients in its area-operated 
or contract group homes for mentally retard- 
ed /developmentallv disabled adults fall within the 
categories listed in Paragraph (a) of this Rule. 

Statutory Authority G.S. 122C-63; 143B-147. 

SUBCHAPTER 18L - PROGRAM COMPO- 
NENT OPERATIONAL STANDARDS 

SECTION .1500 - EARLY INTERVENTION 
SERVICES PROCEDURE SAFEGUARDS 

.1525 CONSENT TO RECEIVE SERVICES 

The parents of a child, eligible to receive early 
intervention services, may determine whether they, 
their child, or other family members will accept or 
decline any type of early intervention service 
without jeopardizing the right to receive other 
early intervention services. 

Statutory Authority G.S. 143B-147; 150B-1 (d); 20 
U.S.C. Sections 1401 et. seq. , 1471 et. seq. 

SUBCHAPTER 18P - OPTIONAL SERVICES 

FOR INDIVIDUALS WHO 

ARE MENTALLY ILL OR EMOTIONALLY 

DISTURBED 

SECTION .0900 - CONTRACTED INPA- 
TIENT PSYCHIATRIC SERVICES 
FOR CHILDREN: ADOLESCENT: ADULT 
AND ELDERLY INDIVIDUALS WHO ARE 
MENTALLY ILL 

.0903 AREA PROGRAM/HOSPITAL 
AGREEMENT 

fa) A written agreement between the area pro- 
gram and the general hospital or private psychiat- 



ric hospital shall be developed and shall specify at 
least the following: 

(1) criteria for service availability for area 
program patients; 

(2) responsibilities of both parties related to 
admission, treatment, and discharge of 
patients; 

(3) parties responsible for the operation of 
the inpatient service; 

(4) responsibilities of each party regarding 
continuity of service for patients dis- 
charged from the inpatient service; and 

(5) provision for the exchange of informa- 
tion. 

(b) The written agreement shall be approved by 
the Division. 

Statutory Authority G.S. 122C-51; 143B-147. 

SECTION .1000 - CONTRACTED STATE 
HOSPITAL PSYCHIATRIC INPATIENT 
SERVICES FOR CHILDREN: ADOLES- 
CENT: ADULT AND ELDERLY 
INDIVIDUALS WHO ARE MENTALLY ILL 

.1003 AREA PROGRAM/HOSPITAL 
AGREEMENT 

fa) A written agreement between the area pro- 
gram and the hospital shall be developed and shall 
specify at least the following: 

(1) criteria for service availability for area 
program patients; 

(2) provision of services to both voluntary 
and involuntary patients; 

(3) parties responsible for the operation of 
the inpatient service; 

(4) responsibilities of each party regarding 
continuity of service for patients dis- 
charged from the inpatient service; and 

(5) provision for the exchange of informa- 
tion. . including at least q discharge 
summary, between the area program and 
the inpatient service. 

(b) The written agreement shall be approved by 
the Division. 

Statutory Authority G.S. 122C-51; 143B-147. 

1\ otice is hereby given in accordance with G.S. 
150B-21.2 that the DHR/Division of Medical 
Assistance intends to adopt rule 10 NCAC 26B 
.0123. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1294 



PROPOSED RULES 



1 he proposed effective date of this action is 
January 4. 1993. 

1 he public hearing will he conducted at 1:30 
p.m. on October 16, 1992 at the North Carolina 
Division of Medical Assistance, 1985 Umstead 
Drive, Room 132, Raleigh. NC 27603. 

Keason for Proposed Action: Tins amendment 
will allow Medicaid to pay for all the components 
of the drug therapies, except for the drugs in a 
package per diem rate. Tliis single coverage 
designation simplifies access to care for Medicaid 
recipients, relieving the recipient and the attending 
physician from having to contact multiple agencies 
to arrange care. 

Ksomment Procedures: Written comments con- 
cerning this amendment must be submitted by 
October 31 , 1992 to: Division of Medical Assis- 
tance, 1985 Umstead Drive, Raleigh, NC 27603, 
ATTN: Clarence Ervin. Oral comments may be 
presented at the hearing. In addition, a fiscal 
impact statement is available upon written request 
from the same address. 

CHAPTER 26 
MEDICAL ASSISTANCE 

SUBCHAPTER 26B - MEDICAL 
ASSISTANCE PROVIDED 

SECTION .0100 - GENERAL 

.0123 HOME LNFUSION THERAPY 

(a) Self-administered Home Infusion Therapy 
(HIT) is covered when it js medically necessary 
and appropriate, and provided through an enrolled 
HIT agency as prescribed by a physician. "Self- 
administered" means that the patient and/or an 
unpaid primary caregiver is capable, able, and 
willing to administer the therapy following appro- 
priate teaching and with adequate monitoring. The 
following therapies are included jn this coverage 
when self-administered: 

Total parenteral nutrition; 
Enteral nutrition; 



intravenous pain management therapy, 
(b) Agencies qualified to enroll as HIT provid- 
ers include: 



01 

ill 



Intrathecal and intravenous ehemothera- 

(4) Intravenous antibiotic therapy; 

(5) Pain management therapy, including 
subcutaneous, epidural, intrathecal, and 



01 

ill 

13] 



A Medicare certified home health agen- 
c_y_ located within North Carolina; 
A North Carolina licensed home health 
agency; 



An agency with a North Carolina office 
that js accredited in the provision of 
home care by the Joint Commission on 
Accreditation of Health Care Organiza- 
tion (JCAHO) and meets the pharma- 
ceutical and equipment services sections 
of the accreditation requirements. 
]_n addition to enrolled HIT providers, agencies 
enrolled to provide durable medical equipment 
may provide the supplies, equipment, and nutrient 
solutions/formulae for enteral infusion therapy. 

Authority G.S. 108A-25(b): 42 C.F.R. 440.230; 
42 C.F.R. 4409.260. 

[\otice is hereby given in accordance with G.S. 
150B-21.2 that the DHR/Division of Medical 
Assistance intends to amend rule cited as 10 NCAC 
26H .0104. 

1 he proposed effective date of this action is 
January 4. 1993. 

1 he public hearing will be conducted at 1:30 
p.m. on November 2, 1992 at the North Carolina 
Division of Medical Assistance, 1985 Umstead 
Drive, Room 297, Raleigh, NC 27603. 

Keason for Proposed Action: Amendment clari- 
fies the practice that has been in place for many 
years. This practice allows hospital based nursing 
facilities with fiscal year ending September 30 and 
state operated facilities with a fiscal year ending 
June to file their cost report within 90 daxs after 
their year ends. 

Lsomment Procedures: Written comments con- 
cerning this amendment must be submitted by 
November 17. 1992 to: Division of Medical 
Assistance, 1985 Umstead Drive. Raleigh, NC 
27603, ATTN: Daphne Lyon. Oral comments may 
be presented at the hearing. In addition, a fiscal 
impact statement is available upon written request 



1295 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



from the same address. 

CHAPTER 26 
MEDICAL ASSISTANCE 

SUBCHAPTER 26H - REIMBURSEMENT 
PLANS 

SECTION .0100 - REIMBURSEMENT FOR 
NURSING FACILITY SERVICES 

.0104 COST REPORTING: AUDITING AND 
SETTLEMENTS 

(a) Each facility that receives payments from the 
North Carolina Medicaid Program must prepare 
and submit a report of its costs and other financial 
information, such as the working trial balance, 
related to reimbursement annually. The report 
must include costs from the fiscal period beginning 
on October 1 and ending on September 30 and 
must be submitted to the state on or before the 
December 3 1 that immediately follows the Septem- 
ber 30 year end. A new provider must submit a 
report for the period beginning with the date of 
certification and ending on September 30. Hospi- 
tal based nursing facilities with a fiscal year ending 
other than September 30 and State operated facili- 
ties with a June fiscal year ending must file their 
cost reports within 90 days after their fiscal year 
ends. Facilities that fail to file their cost reports 
by the due date are subject to payment suspension 
until the reports are filed. The Division of Medical 
Assistance may extend the deadline 30 days for 
filing the report if, in its view, good cause exists 
for the delay. 

(b) Cost report format. The cost report must be 
submitted on forms and in a format and medium 
approved by the Division of Medical Assistance. 
The account structure for the report is based on the 
chart of accounts published by the American 
Healthcare Association in 1979 but amended or 
modified to the extent necessary to meet the 
special reimbursement requirements of this plan. 
The Division of Medical Assistance will make one 
copy of the cost report format available to each 
facility (combination facilities receive only one) on 
or before July 1 of the reporting year for which 
the report is to be filed. 

(c) Cost finding and allocation. Costs must be 
reported in the cost report in accordance with the 
following rules and in the order of priority stated. 

( 1 ) Costs must be reported in accordance 
with the specific provisions of this plan 
as set forth in this Rule. 

(2) Costs must be reported in conformance 



with the Medicare Provider Reimburse- 
ment Manual, HCFA 15. 
(3) Costs must be reported in conformance 
with Generally Accepted Accounting 
Principles, 
(d) The specific cost reporting guidelines related 
to this plan are set forth in the following Para- 
graphs. The state will publish guidelines, consis- 
tent with the provisions of this plan, concerning 
the proper accounting treatment for items de- 
scribed in this Rule as related operating expenses. 
The guidelines may be modified prior to the 
beginning of each cost reporting period. In no 
case, however, shall any modifications be applied 
retroactively. A provider should request clarifica- 
tion in writing from the state if there is uncertainty 
about the proper cost center classification of any 
particular expense item. 

(1) Nursing Cost Center includes the cost 
of nursing staff, medical supplies, and 
related operating expenses needed to 
provide nursing care to patients, includ- 
ing medical records (including forms), 
utilization review, the Medical Director 
and the Pharmacy Consultant. The 
amount of nursing time provided to 
each patient must be recorded in order 
to allocate nursing cost between skilled 
and intermediate nursing care. 

(2) Dietary Cost Center includes the cost of 
staff, raw food, and supplies needed to 
prepare and deliver food to patients. 

(3) Laundry and Linen Cost Center in- 
cludes the cost of staff, bed linens 
(replacement mattresses and related 
operating expenses needed to launder 
facility-provided items). 

(4) Housekeeping Cost Center includes the 
cost of staff and supplies needed to 
keep the facility clean. 

(5) Patient Activities Cost Center includes 
the cost of staff, supplies, and related 
operating expenses needed to provide 
appropriate diversionary activities for 
patients. 

(6) Social Services includes the cost of 
social workers and related operating 
expenses needed to provide necessary 
social services to patients. 

(7) Ancillary Cost Center includes the cost 
of all therapy services covered by the 
Medicaid program and billable medical 
supplies. Providers must bill Medicare 
Part B for those ancillary services 
covered under the Medicare Part B 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1296 



PROPOSED RULES 



program. Ancillary cost centers in- 
clude: Radiology, Laboratory, Physical 
Therapy, Occupational Therapy, Speech 
Therapy, Oxygen Therapy, Intravenous 
Fluids, Billable Medical Supplies, 
Parenteral/Enteral Therapy and life 
sustaining equipment, such as oxygen 
concentrators, respirators, and ventila- 
tors and other specifically approved 
equipment. 

(8) Administrative and General Cost Center 
includes all costs needed to administer 
the facility including the staff costs for 
the administrator, assistants, billing and 
secretarial personnel, personnel director 
and pastoral expenses. It includes the 
costs of copy machines, dues and sub- 
scriptions, transportation, income taxes, 
legal and accounting fees, start-up, and 
a variety of other administrative costs 
as set forth in the Chart of Accounts. 
Interest expense other than that stem- 
ming from mortgages or loans to ac- 
quire physical plant items shall be 
reported here. 

(9) Property Ownership and Use: 

(A) This cost center includes all allowable 
costs related to the acquisition and/or 
use of the physical assets including 
building, fixed equipment and mov- 
able equipment, that are required to 
deliver patient care, except the special 
equipment, as specified in .0104(d)(7) 
of this Rule that may be charged to 
the life-sustaining equipment cost 
center. Specifically it includes the 
following items: 

(i) all equipment expense regardless 
of equipment nature, 

(ii) lease expense for all physical 
assets, 

(iii) depreciation of assets utilizing the 
straight line method, 

(iv) interest expense of asset related 
liabilities, (e.g., mortgage ex- 
pense), 

(v) property taxes. 

(B) For the purposes of computing allow- 
able lease expense and for balance 
sheet presentation for Return on 
Equity computations (see Rule .0105), 
leases shall not be capitalized. 

(C) In establishing the allowable cost for 
depreciation and for interest on capital 
indebtedness, with respect to an asset 



which has undergone a change of 
ownership, the valuation of the asset 
shall be the lesser of allowable acqui- 
sition cost less accumulated deprecia- 
tion to the first owner of record on or 
after July 18, 1984 or the acquisition 
cost to the new owner. Depreciation 
recapture will not be performed at 
sale. The method for establishing the 
allowable related capital indebtedness 
shall be as follows: 
(i) The allowable asset value shall be 
divided by the actual acquisition 
cost, 
(ii) The product computed in step 1 
shall be multiplied times the value 
of any related capital indebted- 
ness, 
(iii) The result shall be the liability 
amount upon which interest may 
be recorded at the rate set forth in 
the debt instrument or such lower 
rate as the state may prove is 
reasonable. The allowable asset 
and liability values established 
through the process in this Rule 
shall be those used in balance 
sheet presentations for return on 
equity computation (see Rule 
.0105). These procedures are 
established to implement the 
provisions of PL 98-369 Section 
2314. 

(10) Operation of Plant and Maintenance 
Cost Center includes all costs necessary 
to operate or maintain the functionality 
and appearance of the plant. These 
include: maintenance staff, utilities, 
repairs and maintenance to all equip- 
ment. 

(11) Equipment Expense. Equipment is 
defined as an item with a useful life of 
more than two years and a value greater 
than five hundred dollars ($500.00). 
Equipment ownership and use costs 
shall be reported in the Property Own- 
ership and Use Cost Center. Equip- 
ment maintenance and repair costs shall 
be reported in the Operation of Plant 
and Maintenance Cost Center. Equip- 
ment shall not be reported elsewhere. 

(12) Training Expense. Training expense 
must be identified in the appropriate 
benefiting cost center. The costs of 
training nurse aides must be identified 



1297 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



separately and may include the cost of 
purchasing programs and equipment 
that have been approved by the State 
for training or testing. 

(13) Home Office Costs. Home office costs 
are generally charged to the Adminis- 
trative and General Cost Centers. In 
some cases, however, certain personnel 
costs which are direct patient care 
oriented may be allocated to "direct" 
patient care cost centers if time records 
are maintained to document the perfor- 
mance of direct patient care services. 
No Home office overhead may be so 
allocated. The basis of this allocation 
among facilities participating in the 
North Carolina Medicaid program may 
be: 

(A) specific time records of work per- 
formed at each facility, or 

(B) patient days in each facility to which 
the costs apply relative to the total 
patient days in all the facilities to 
which the costs apply. 

(14) Management Fees. Management fees 
are charged to the Administrative and 
General Cost Center. In some cases, 
however, a portion of a management 
fee may be allocated to a direct patient 
care cost center if time records are 
maintained to document the perfor- 
mance of direct patient care services. 
The amount so allocated may be equal 
only to the salary and fringe benefits of 
persons who are performing direct 
patient care services while employed by 
the management company. Adequate 
records to support these costs must be 
made available to staff of the Division 
of Medical Assistance. The basis of 
this allocation among facilities partici- 
pating in the North Carolina Medicaid 
program may be: 

(A) specific time records of work per- 
formed at each facility, or 

(B) patient days in each facility to which 
the costs apply relative to the total 
patient days in all the facilities to 
which the costs apply. 

(15) Related Organization Costs. It is the 
nursing facility's responsibility to dem- 
onstrate by convincing evidence to the 
satisfaction of the Division of Medical 
Assistance that the costs are reasonable. 
Reasonable costs of related organiza- 



tions are to be identified in accordance 
with direct and indirect cost center 
categories as follows: 

(A) Direct Cost: 

(i) Compensation of direct care staff 
such as nursing personnel (aides, 
orderlies, nurses), food service 
workers, housekeeping staff and 
other personnel who would nor- 
mally be accounted for in a direct 
cost center. 

(ii) Supplies and services that would 
normally be accounted for in a 
direct cost center. 

(iii) Capital, rental, maintenance, 
supplies/repairs and utility costs 
(gas, water, fuel, electricity) for 
facilities that are not typically a 
part of a nursing facility. These 
facilities might include such items 
as warehouses, vehicles for deliv- 
ery and offices which are totally 
dedicated or clearly exceed the 
number, size, or complexity 
required for a normal nursing 
facility, its home office, or man- 
agement company. 

(iv) Compensation of all administra- 
tive staff who perform no duties 
which are related to the nursing 
facility or its home office and 
who are neither officers nor own- 
ers of the nursing facilities or its 
home office. 

(B) Indirect Cost: 

(i) Capital, rental, maintenance, 
supplies/repairs, and utility costs 
which are normally or frequently 
a part of a nursing facility. This 
would include, for example, 
kitchen and laundry facilities. 

(ii) Home office costs except for 
salary and fringe benefits of Per- 
sonnel, Accounting and Data 
Processing staff which are allocat- 
ed by acceptable methods are 
direct costs when the work per- 
formed is specific to the related 
organization that provides a direct 
care service or product to the 
provider. 

(iii) Compensation of all administra- 
tive staff who perform any duties 
for the nursing facility or its home 
office. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1298 



PROPOSED RULES 



(iv) All compensation of all officers 
and owners of the nursing facility 
or its home office, or parent 
corporation. 
The related organization must file a Medicaid 
Cost Statement (DMA-4083) identifying their 
costs, adjustments to costs, allocation of costs, 
equity capital, adjustments to equity capital, and 
allocations of equity capital along with the nursing 
facilities cost report. A home office, or parent 
company, will be recognized as a related organiza- 
tion. Auditable records to support these costs 
must be made available to staff of the Division of 
Medical Assistance and its designated contract 
auditors. Undocumented costs will be disallowed. 
It is the nursing facility's responsibility to demon- 
strate by convincing evidence to the satisfaction of 
the Division of Medical Assistance that the criteria 
in the Provider Reimbursement Manual. Section 
1010. has been met in order to be recognized as an 
exception to the related organization principle. 
When a related organization is deemed an excep- 
tion; reasonable charges by the related organiza- 
tion to the nursing facility are recognized as 
allowable costs; receiveable/payables from/to the 
nursing facility and related organization deemed an 
exception are not adjusted from the nursing 
facility's balance sheet in computing equity capital, 
(e) Auditing and Settlement. All filed cost 
reports must be desk audited and interim reim- 
bursement settlements made in accordance with the 
provision of this plan. This settlement is issued 
within 180 days of the date the cost report was 
filed or within 180 days of December 31 of the 
fiscal year to which the report applies, whichever 
is later. The state may elect to perform field 
audits on any filed cost reports within three years 
of the date of filing and issue a final settlement on 
a time schedule that conforms to Federal law and 
regulation. If the state decides not to field audit a 
facility a final reimbursement notice may be issued 
based on the desk audited settlement. The state 
may reopen and field audit any cost report after 
the final settlement notice to comply with Federal 
law and regulation or to enforce laws and regula- 
tions prohibiting abuse of the Medicaid Program 
and particularly the provisions of this reimburse- 
ment plan. 

Authority- G.S. 108A-25(b); W8A-54; 108A-55: 
S.L. 1985, c. 479, s. 86: 42 C.F.R. 447. Subpart 
C. 

TITLE 15A - DEPARTMENT OF 
ENVIRONMENT, HEALTH, AND 



NATURAL RESOURCES 

iSotice is hereby given in accordance with G.S. 
150B-21.2 that the North Carolina Wildlife Re- 
sources Commission intends to amend the rule 
cited as 15 A NCAC WD .0003 

1 he proposed effective date of this action is 
January 1. 1993. 

1 he public hearing will be conducted at 7:30 
p.m.. October 20, 1992, Ground Floor Hearing 
Room, Archdalc Building, 512 N. Salisbury Street, 
Raleigh. NC 27604-1188. 

Reason for Proposed Action: To allow limited 
access to certain game lands for horseback riding. 

Ksomment Procedures: Interested persons may 
present their views either orally or in writing at 
the hearing. In addition, the record of hearing 
will be open for receipt of written comments from 
October 1, 1992 to October 31, 1992. Such 
written comments must be delivered or mailed to 
the N.C. Wildlife Resources Commission, 512 N. 
Salisbury Street, Raleigh, NC 27604-1188. 

CHAFTER 10 - WILDLIFE RESOURCES 
AND WATER SAFETY 

SUBCHAPTER 10D - GAME LAND 
REGULATIONS 

.0003 HUNTING ON GAME LANDS 

(a) Safety Requirements. No person while 
hunting on any designated game land shall be 
under the influence of alcohol or any narcotic 
drug, or fail to comply with special restrictions 
regarding the use of the Blue Ridge Parkway 
where it adjoins game lands listed in this Rule. 

(b) Traffic Requirements. No person shall park 
a vehicle on game lands in such a manner as to 
block traffic, gates or otherwise prevent vehicles 
from using any roadway. 

(c) Tree Stands. It is unlawful to erect or to 
occupy, for the purpose of hunting, any tree stand 
or platform attached by nails, screws, bolts or wire 
to a tree on any game land designated herein. 
This prohibition shall not apply to lag-screw steps 
or portable stands that are removed after use with 
no metal left remaining in or attached to the tree. 

(d) Time and Manner of Taking. Except where 



1299 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



closed to hunting or limited to specific dates by 
these regulations, hunting on game lands is permit- 
ted during the open season for the game or 
furbearing species being hunted. On managed 
waterfowl impoundments, hunters shall not enter 
the posted impoundment areas earlier than 4:00 
a.m. on the permitted hunting dates, and hunting 
is prohibited after 1:00 p.m. on such hunting 
dates; decoys may not be set out prior to 4:00 
a.m. and must be removed by 3:00 p.m. each day. 
No person shall operate any vessel or vehicle 
powered by an internal combustion engine on a 
managed waterfowl impoundment. 

No person shall attempt to obscure the sex or age 
of any bird or animal taken by severing the head 
or any other part thereof, or possess any bird or 
animal which has been so mutilated. 

No person shall place, or cause to be placed on 
any game land, salt, grain, fruit, or other foods 
without prior written authorization of the commis- 
sion or its agent. No person shall take or attempt 
to take any game birds or game animals attracted 
to such foods. 

No live wild animals or wild birds shall be 
removed from any game land. 

(e) Hunting Dates: 

(1) Doves may be taken on the following 
game lands and dove hunting is limited 
to Mondays, Wednesdays, Saturdays 
and to Thanksgiving, Christmas and 
New Year's Days within the 
federally-announced season: 

Buncombe County— Browntown Farms Game 
Land 

Guilford County--Guilford County Farm Game 
Land 

Lenoir County--Caswell Farm Game Land 

Wayne County—Cherry Farm Game Land 

(2) Any game may be taken during the 
open seasons on the following game 
lands and hunting is limited to Mon- 
days, Wednesdays, Saturdays and 
Thanksgiving, Christmas and New 
Year's Days. In addition, deer may be 
taken with bow and arrow on the open- 
ing day of the bow and arrow season 
for deer. Raccoon and opossum hunt- 
ing may continue until 7:00 a.m. on 
Tuesdays, until 7:00 a.m. on Thurs- 
days, and until midnight on Saturdays. 
Additional restrictions apply as indicat- 
ed in parentheses following specific 
designations: 

Ashe County— Carson Woods Game Land 
Bertie County— Bertie County Game Lands 



Bladen County— Bladen Lakes State Forest 
Game Lands (Handguns may not be 
carried and, except for muzzle-loaders, 
rifles larger than .22 caliber rimfire 
may not be used or possessed. On the 
Breece Tract and the Singletary Tract 
deer and bear may be taken only by 
still hunting. Deer of either sex may be 
taken on the first Wednesday after 
Thanksgiving and on the second Satur- 
day after Thanksgiving.) 

Caswell County— Caswell Game Land 

Catawba and Iredell Counties— Catawba Game 
Land (No deer may be taken from the 
tract known as Island Point and deer 
may be taken with bow and arrow only 
from the tract known as Molly's Back- 
bone.) 

Lenoir County— H.M. Bizzell, Sr., Game Land 

Onslow County— White Oak River Impound- 
ment Game Land (In addition to the 
dates above indicated, waterfowl may 
be taken on the opening and closing 
days of the applicable waterfowl sea- 
sons.) 

Pender County— Holly Shelter Game Land (In 
addition to the dates above indicated, 
waterfowl may be taken on the opening 
and closing days of the applicable 
waterfowl seasons. Deer of either sex 
may be taken on Mondays, Wednes- 
days, and Saturdays from the first 
Wednesday after Thanksgiving through 
the third Saturday after Thanksgiving.) 

Richmond, Scotland and Moore 
Counties— Sandhills Game Land (The 
regular gun season for deer consists of 
the open hunting dates from the second 
Monday before Thanksgiving to the 
third Saturday after Thanksgiving ex- 
cept on the field trial grounds where the 
gun season is from the second Monday 
before Thanksgiving to the Saturday 
following Thanksgiving. Deer may be 
taken with bow and arrow on all open 
hunting dates during the bow and arrow 
season, as well as during the regular 
gun season. Deer may be taken with 
muzzle-loading firearms on Monday, 
Wednesday and Saturday of the second 
week before Thanksgiving week, and 
during the regular gun season. Except 
for the deer seasons above indicated 
and the managed either-sex permit 
hunts, the field trial grounds are closed 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1300 



PROPOSED RULES 



to all hunting during the period October 
22 to March 31. In addition to the 
regular hunting days, waterfowl may be 
taken on the opening and closing days 
of the applicable waterfowl seasons.) 
Wild turkey hunting is by permit only. 

Robeson County--Bullard and Branch Hunting 
Preserve Game Land 

Stokes County— Sauratown Plantation Game 
Land 

Yadkin County— Huntsville Community Farms 
Game Land 

(3) Any game may be taken on the follow- 
ing game lands during the open season, 
except that: 

(A) Bears may not be taken on lands 
designated and posted as bear sanctu- 
aries; 

(B) Wild boar may not be taken with the 
use of dogs on such bear sanctuaries, 
and wild boar may be hunted only 
during the bow and arrow seasons, 
the muzzle-loading deer season and 
the regular gun season on male deer 
on bear sanctuaries located in and 
west of the counties of Madison, 
Buncombe, Henderson and Polk; 

(C) On game lands open to deer hunting 
located in or west of the counties of 
Rockingham. Guilford, Randolph. 
Montgomery and Anson, the follow- 
ing rules apply to the use of dogs 
during the regular season for hunting 
deer with guns: 

(i) Except for the counties of Chero- 
kee, Clay, Jackson, Macon, Mad- 
ison, Polk, and Swain, game birds 
may be hunted with dogs. 

(ii) In the counties of Cherokee, Clay, 
Jackson, Macon. Madison, Polk, 
and Swain, small game in season 
may be hunted with dogs on all 
game lands except on bear sanctu- 
aries. 

(D) On Croatan. Goose Creek, New Hope 
and Shearon Harris Game Lands 
waterfowl may be taken only on 
Mondays, Wednesdays, Saturdays; on 
Thanksgiving, Christmas and New 
Year's Days; and on the opening and 
closing days of the applicable water- 
fowl seasons; except that outside the 
posted waterfowl impoundments on 
Goose Creek Game Land hunting any 
waterfowl in season is permitted any 



week day during the last 10 days of 
the regular duck season as established 
by the U.S. Fish and Wildlife Ser- 
vice; On the Pamlico Point, Campbell 
Creek, and Spring Creek impound- 
ments a special permit is required for 
hunting on those opening and closing 
days of the waterfowl season as well 
as on those Saturdays that fall after 
November 1 of the season and on 
Thanksgiving and New Year's day; 

(E) On the posted waterfowl impound- 
ments of Gull Rock Game Land hunt- 
ing of any species of wildlife is limit- 
ed to Mondays. Wednesdays, Satur- 
days; Thanksgiving. Christmas, and 
New Year's Days; and the opening 
and closing days of the applicable 
waterfowl seasons; 

(F) On bear sanctuaries in and west of 
Madison, Buncombe, Henderson and 
Polk Counties dogs may not be 
trained or allowed to run unleashed 
between March 1 and October 1 1 ; 

(G) On New Lake, Pungo River, and Gull 
Rock Game Lands deer of either sex 
may be taken from the first Wednes- 
day after Thanksgiving through the 
third Saturday after Thanksgiving; 

(H) On Butner-Falls of Neuse and Person 
Game Lands waterfowl may be taken 
only on Tuesdays. Thursdays and 
Saturdays. Christmas and New Year's 
Days, and on the opening and closing 
days of the applicable waterfowl 
seasons; 

(I) On Angola Bay, Butner-Falls of 
Neuse, Croatan, Goose Creek, and 
Hofmann Forest Game Lands deer of 
either sex may be taken from the first 
Wednesday after Thanksgiving 
through the following Saturday; 

(J) Horseback riding is allowed on the 
Caswell and Thurmond Chatham 
game lands only during June, July. 
and August and on Sundays during 
the remainder of the year except 
during open turkey and deer seasons. 
Horseback riding is allowed only on 
roads opened to vehicular traffic. 
Participants must obtain a game lands 
license prior to engaging in such 
activity; 

(K) On the posted waterfowl impound- 
ments on the New Hope and 



1301 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



wwMarjdWtfJWMiii mtt 



PROPOSED RULES 



Butner-Falls of Neuse game lands a 
special permit is required for all 
waterfowl hunting; 

(L) Additional restrictions or modifica- 
tions apply as indicated in parentheses 
following specific designations: 

Alexander and Caldwell Counties— Brushy 

Mountains Game Lands 

Anson County— Anson Game Land 

Anson, Montgomery, Richmond and Stanly 
Counties— Pee Dee River Game Lands 

Ashe County— Elk Ridge Game Lands 

Ashe County— Cherokee Game Lands 

Ashe and Watauga Counties— Elk Knob 
Game Land 

Avery, Buncombe, Burke, Caldwell, 
Haywood, Henderson, Jackson, Madi- 
son, McDowell, Mitchell, 
Transylvania, Watauga and Yancey 
Counties—Pisgah Game Lands 
(Harmon Den and Sherwood Bear 
Sanctuaries in Haywood County are 
closed to hunting raccoon, opossum 
and wildcat. Training raccoon and 
opossum dogs is prohibited from 
March 1 to October 1 1 in that part of 
Madison County north of the French 
Broad River, south of US 25-70 and 
west of SR 1319.) 

Bertie and Washington Counties— Bachelor 
Bay Game Lands 

Beaufort and Pamlico Counties— Goose 
Creek Game Land 

Brunswick County— Green Swamp Game 
Land 

Burke and Cleveland Counties— South 
Mountains Game Lands 

Caldwell, Watauga and Wilkes 
Counties— Yadkin Game Land 

Carteret, Craven and Jones 
Counties— Croatan Game Lands 

Chatham County— Chatham Game Land 

Chatham, Durham, Orange, and Wake 
Counties— New Hope Game Lands 
(On areas posted as "archery zones" 
hunting is limited to bow and arrow. 
Horseback riding , including all equine 
species, is prohibited allowed only 
during March, June, July, and August 
and on Sundays during the remainder 
of the year .) 

Chatham and Wake Counties— Shearon 
Harris Game Land 

Cherokee, Clay, Graham, Jackson, Macon, 
Swain and Transylvania 



Counties— Nantahala Game Lands. 
Raccoon and opossum may be hunted 
only from sunset Friday until sunrise 
on Saturday and from sunset until 
12:00 midnight on Saturday on Fires 
Creek Bear Sanctuary in Clay County 
and in that part of Cherokee County 
north of US 64 and NC 294, east of 
Persimmon Creek and Hiwassee 
Lake, south of Hiwassee Lake and 
west of Nottely River; in the same 
part of Cherokee County dog training 
is prohibited from March 1 to Octo- 
ber 11. It is unlawful to train dogs or 
allow dogs to run unleased on any 
game land in Graham County between 
March 1 and October 1 1 . 
Chowan County— Chowan Game Land 
Cleveland County— Gardner-Webb Game 
Land 

Craven County— Neuse River Game Land 
Currituck County— North River Game Land 
Currituck County— Northwest River Marsh 
Game Land 

Dare County— Dare Game Land (No hunting 
on posted parts of bombing range.) 
Davidson, Davie, Montgomery, Rowan and 
Stanly Counties— Alcoa Game Land 
Davidson County— Linwood Game Land 
Davidson, Montgomery and Randolph 
Counties— Uwharrie Game Land 
Duplin and Pender Counties— Angola Bay 
Game Land 

Durham, Granville and Wake 
Counties— Butner-Falls of Neuse 
Game Land (On that part marked as 
the Penny Bend Rabbit Research Area 
no hunting is permitted. Horseback 
riding , including all equine species, is 
prohibited allowed only during 
March, June, July, and August and on 
Sundays during the remainder of the 
year .) 
Franklin County— Franklin Game Lands 
Gates County— Chowan Swamp Game Land 
Henderson, Polk and Rutherford 
Counties— Green River Game Lands 
Hyde County— Gull Rock Game Land 
Hyde County— Pungo River Game Land 
Hyde and Tyrrell Counties— New Lake 
Game Land 

Jones and Onslow Counties— Hofmann 
Forest Game Land 
Lee County— Lee Game Land 
McDowell County— Hickory Nut Mountain 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1302 



PROPOSED RULES 



Game Land 

McDowell and Rutherford 
Counties— Dysartsville Game Lands 
Moore County--Moore Game Land 
New Hanover County— Sutton Lake Game 
Land 

Person County— Person Game Land 
Transylvania County— Toxaway Game Land 
Tyrrell County— Lantern Acres Game Land 
Vance County— Vance Game Land. (The 
use of dogs, centerfire rifles and 
handguns for hunting deer is prohibit- 
ed on the Nutbush Peninsula tract of 
Vance Game Lands.) 
Wilkes County— Thurmond Chatham Game 
Land 

(4) Deer of either sex may be taken on the 
hunt dates indicated by holders of per- 
mits to participate in managed hunts 
scheduled and conducted in accordance 
with this Subparagraph on the game 
lands or portions of game lands includ- 
ed in the following schedule: 

Friday and Saturday of the first week 
after Thanksgiving Week: 

Lwharrie and Alcoa southeast of NC 

49 
Thursday and Friday of the week before 
Thanksgiving Week: 

Sandhills east of US 1 

Sandhills west of US 1 
Application forms for permits to partici- 
pate in managed deer hunts on game 
lands, together with pertinent informa- 
tion and instructions, may be obtained 
from hunting and fishing license agents 
and from the Wildlife Resources Com- 
mission. Completed applications must 
be received by the Commission not 
later than the first day of October next 
preceding the dates of hunt. Permits 
are issued by random computer selec- 
tion, are mailed to the permittees 30 
days prior to the hunt, and are non- 
transferable. A hunter making a kill 
must tag the deer and report the kill to 
a wildlife cooperator agent. 

(5) The following game lands and Federal 
Wildlife Refuge are closed to all hunt- 
ing except to those individuals who 
have obtained a valid and current per- 
mit from the Wildlife Resources Com- 
mission: Bertie. Halifax and Martin 
Counties— Roanoke River Wetlands; 
Bertie County— Roanoke River National 



Wildlife Refuge. 

Dare County— Dare Game Lands 
(Those parts of bombing range posted 
against hunting) 

Davie— Hunting Creek Swamp Water- 
fowl Refuge 

Gaston, Lincoln and Mecklenburg 
Counties— Cowan's Ford Waterfowl Refuge (except 
for youth either-sex deer hunts by 

permit only on the first and second Saturdays in 
October). 

Statutory Authority G.S. 113-134; 113-264; 
113-291.2; 113-291.5: 113-305. 



>?. :'f. i'< -J< •>. -: : : ^ >■ >; ><>:>; & >< % ^ % % 

iVotice is hereby given in accordance with G.S. 
150B-21.2 that the North Carolina Wildlife Re- 
sources Commission intends to amend rule cited as 
15ANCAC 10F .0336. 

1 he proposed effective date of this action is 
January 1. 1993. 

1 he public hearing will be conducted at 10:00 
a.m. on October 16, 1992 at Room 332, Archdale 
Building, 512 N. Salisbury Street, Raleigh, NC 
27604-1188. 

MXeason for Proposed Action: Necessary to 
decrease incidences of speeding boats in high risk 
areas. 

i^onunent Procedures: Interested persons may- 
present their views either orally or in writing at 
the hearing. In addition, the record of hearing 
will be open for receipt of written comments from 
October 1, 1992 to October 31, 1992. Such 
written comments must be delivered or mailed to 
the N.C. Wildlife Resources Commission, 512 N. 
Salisbury Street, Raleigh, NC 27604-1188. 

CHAPTER 10 - WILDLIFE RESOURCES 
AND WATER SAFETY 

SUBCHAPTER 10F - MOTORBOATS AND 
WATER SAFETY 

SECTION .0300 - LOCAL WATER SAFETY 
REGULATIONS 



1303 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



.0336 NORTHAMPTON COUNTY 

(a) Regulated Area. This Rule applies only to 
that portion of Lake Gaston which lies within the 
boundaries of Northampton County. 

(b) Speed Limit Near Ramps. — No person shall 
operate a vessel at greater than no wake speed 
within 50 yards of any public boat launching ramp 



while 



-the — waters — »f- — Gaston — Lake 



Northampton County. 

{ej £b) Speed Limit in Mooring Areas. No 
person shall operate a vessel at greater than 
no-wake speed while within a marked mooring 
area established with the approval of the Executive 
Director, or his representative, on the waters of 
Gaston Lake in Northampton County. 

^4) — Speed Limit Near Bridge. — No person shall 
operate a vessel at greater than no wake speed 
within 50 yards on either s ide of the Pea Hill 
Creek Bridge. 

(c) Speed Limit Near Shore Facilities. No 
person shall operate a vessel at greater than no- 
wake speed within 50 yards of any marked boat 
launching area, dock, pier, bridge, marina, boat 
storage structure, or boat service area on the 
waters of the regulated areas described in Para- 
graph (a) of this Rule. 

fe) (dj Restricted Swimming Areas. No person 
operating or responsible for the operation of a 
vessel shall permit it to enter any marked public 
swimming area established with the approval of the 
Executive Director, or his representative, on the 
waters of Gaston Lake in Northampton County. 

ff) (e) Placement and Maintenance of Markers. 
The Board of Commissioners of Northampton 
County is designated a suitable agency for place- 
ment and maintenance of the markers implement- 
ing this Rule, subject to the approval of the United 
States Coast Guard and United States Army Corps 
of Engineers. With regard to marking Gaston 
Lake, all of the supplementary standards listed in 
Rule .0301(g) of this Section shall apply. 

Statutory Authority G.S. 75 A -3; 75A-15. 

TITLE 21 - OCCUPATIONAL 
LICENSING BOARD 

iSotice is hereby given in accordance with G.S. 
150B-21.2 that the Board of Medical Examiners of 
the State of North Carolina intends to adopt rule 
cited as 21 NCAC 32B .0215 and amend rule(s) 
cited as 21 NCAC 32A .0001; 32B .0101, .0209- 
.0214. .0305. .0314. .0315; 32C .0003, .0006. 



1 he proposed effective date of this action is 
January 1, 1993. 

1 he public hearing will be conducted at 9:00 
a.m. on November 2, 1992 at the NC Board of 
Medical Examiners, 1203 Front Street, Raleigh, 
NC 27609. 

MXeason for Proposed Action: 
Rule Reason 

32B .0215 Adopt new rule to explain combina- 
tions of old and new exams acceptable for licen- 
sure. 

32A .0001 Amend to change office address and 
include PO mailing address. 

32B .0101 Amend rules to include a new national 

exam, USLME, as a basis for licensure in NC and 

to allow the Assistant Executive Secretary to 

conduct personal licensure interviews in 32B 

.0214. 

32B .0209 

32B .0210 

32B .0211 

32B .0214 

32B .0305 

32B .0314 

32B .0315 

32B . 0212 Amend rule to indicate that exams held 
in June and December are licensing exams. 

32B .0213 Amend rule to do additional back- 
ground checks before licensing physicians when 
they finish postgraduate training. 

32C . 0003 Amend to allow the Assistant Executive 
Secretary to sign forms. 
32C .0006 

Ksomment Procedures: Persons interested may 
present written or oral statements relevant to the 
actions proposed at a hearing to be held as indi- 
cated above. Written statements not presented at 
the hearing should be directed before October 16, 
1992, to the following address: Administrative 
Procedures, NC Board of Medical Examiners, 
P.O. Box 26808, Raleigh, NC 27611-6808. 

CHAPTER 32 - BOARD OF MEDICAL 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1304 



PROPOSED RULES 



EXAMINERS 



EXAMINATION 



SUBCHAPTER 32A - ORGANIZATION 

.0001 LOCATION 

The location of the office of the Board of Medi- 
cal Examiners is 1313 Navaho Drive . 1203 Front 
Street. Raleigh. North Carolina 27609. The 
phone number is (910) 876 3885 (919) 828-1212 . 
The mailing address is Post Office Box 26808. 
Raleigh. North Carolina 27611-6808. 

Statutory Authority G.S. 90-2. 

SUBCHAPTER 32B - LICENSE TO 
PRACTICE MEDICINE 



SECTION .0100 - GENERAL 

.0101 DEFECTIONS 

The following definitions apply to Rules within 
this Subchapter: 

(1) ACGME - Accreditation Council for 
Graduate Medical Education. 

(2) AOA - American Osteopathic Associa- 
tion. 

(3) Board - Board of Medical Examiners of 
the State of North Carolina. 

(4) ECFMG - Educational Commission for 
Foreign Medical Graduates. 

(5) Fifth Pathway - an avenue for licensure 
as defined in the Directory of Accredit- 
ed Residencies 1977-1978, American 
Medical Association, pp. 30-32. 

(6) FLEX - Federation Licensing Examina- 
tion, (not administered after December 
1993) 



(7) 

(8) 

(9) 



(10) 



LCME - Liaison Commission on Medi- 
cal Education. 

SPEX - Special Purpose Examination. 
AMA Physician's Recognition Award - 
American Medical Association recogni- 
tion of achievement by physicians who 
have voluntarily completed programs of 
continuing medical education. 
American Specialty Boards - specialty 
boards approved by the American 
Board of Medical Specialties. 
USMLE = United States Medical Li- 
censing Examination. 



.0209 FEE 

(a) FLEX fee 

(1) The fee for both components of the 
FLEX written examination taken to- 
gether is two hundred and fifty dollars 
($250.00), plus the cost of test materi- 
als, due at the time of application. 
fb4(2) If the two FLEX components are taken 
separately, the fee for each component 
is due at the time of application for that 
component as follows: 
fB (A) for the first component, two 
hundred and fifty dollars 
(S250.00) plus the cost of test 
materials: 
f2-)(B) for the second component, one 
hundred and fifty dollars 
($150.00) plus the cost of test 
materials. 

(b) USMLE fee : The fee for USMLE is two 
hundred and fifty dollars ($250.00). plus the cost 
of test materials, due at the time of application. 

(c) Fees are non-refundable. 

fe-> — In the event the applicant fails to make a 
passing score on both component s taken together 
or either component taken separately, the foe will 
not be refunded. 



Statutory Authority G.S. 90-6. 

SECTION .0200 - LICENSE BY WRITTEN 



(d) In the event the applicant does not appear for 
the regularly scheduled examination or the applica 
tion i s withdrawn, no portion of the fee will be 
refunded. 

Statuton- Authority G.S. 90-15. 



.0210 DEADLEVE 

All application materials must be in the Board's 
office at least 75 90 days prior to the written 
examination. The 75 90 day deadline may be 
waived on the certification of graduation require- 
ment. Rule .0203 of this Section, if the applicant 
is either in attendance at a medical school ap- 
proved by LCME or AOA located in North Caroli- 
na or is a citizen of the State of North Carolina. 
However, before the examination, the applicant 
must satisfy the certificate of graduation require- 
ment as follows: 

(1) Not less than 75 90 days before the 
date of the examination, the Board must 
receive a letter from the dean of the 
applicant's medical school stating that 
the applicant is expected to complete all 
requirements for graduation prior to the 



1305 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



date of the examination. 

(2) Prior to the date of the examination, the 
Board must receive a letter from the 
dean of the medical school stating that 
the applicant has completed all require- 
ments for, and will receive, the M.D. 
degree from the medical school. 

(3) After the applicant's graduation, the 
Board must receive a letter from the 
applicant's medical school certifying the 
date on which the applicant received the 
M.D. degree. This certification must 
bear the signature of the dean or other 
official and the seal of the medical 
school. 

Statutory Authority G.S. 90-9. 

,0211 PASSING SCORE 

To pass the FLEX written examination, the 
applicant is required to attain a score of at least 75 
on FLEX Component I and a score of at least 75 
on FLEX Component II. Components may be 
taken in tandem. Any component that is failed 
may be retaken; however, Component II may not 
be taken alone unless the applicant has passed 
Component I within the last seven years. Both 
components must be passed within seven years of 
the date of taking the initial examination. 
To pass Step 3 of the USMLE written examina- 
tion, the applicant is required to attain a score of 
at least 75. 

Statutory Authority G.S. 90-9; 90-12; 90-15. 



f2)(B) Graduates of medical schools other 
than those approved by LCME or 
AOA must have satisfactorily com- 
pleted three years of graduate medical 
education and training approved by 
ACGME or AOA; 

(3) letters from all training program direc- 
tors since passing the written examina- 
tion; 

(4) reports from all states in which the 
applicant has ever been licensed to 
practice medicine indicating the status 
of the applicant's license and whether 
or not the license has been revoked, 
suspended, surrendered, or placed on 
probationary terms (mailed directly 
from other state boards to the Board); 

(5) AMA Physician Profile (requested of 
AMA by the Board); and 

(6) Federation inquiry (requested of the 
Federation of State Medical Boards by 
the Board). 

Statutory Authority G.S. 90-9. 

.0214 PERSONAL INTERVIEW 

To be eligible for the written examination, 
applicants who are graduates of medical schools 
not approved by the LCME or AOA must appear 
before the Executive Secretary or Assistant Execu- 
tive Secretary for a personal interview upon 
completion of all credentials. This interview must 
be conducted at least 75 90 days prior to the date 
of the examination. 



.0212 TIME AND LOCATION 

The Board holds two licensing examinations each 
year, one in June and one in December, in Ra- 
leigh, North Carolina. 

Statutory Authority G.S. 90-5. 

.0213 GRADUATE MEDICAL EDUCATION 
AND TRAINING FOR LICENSURE 

Before licensure, physicians who pass the written 
examination must furnish the following: 

(1) Board application questionnaire; 

(2) proof of graduate medical education and 
training taken after graduation from 
medical school as follows: 

f4-)(A) Graduates of medical schools ap- 
proved by LCME or AOA must have 
satisfactorily completed one year of 
graduate medical education and train- 
ing approved by ACGME or AOA. 



Statutory Authority G.S. 90-6. 

.0215 EXAMINATION COMBINATIONS 

(a) The routine examination sequences are as 
follows: 

National Board Part I 



LU 

121 
13} 



(b) The following combinations are acceptable 

for licensure if completed prior to the year 2000: 

LU National Board Part I or USMLE Step 

1 plus 

National Board Part II or USMLE Step 

2 plus 

National Board Part III or USMLE Step 



National Board Part II 
National Board Part III 
FLEX Component l_ 
FLEX Component 2 
USMLE Step 1 
USMLE Step 2 
USMLE Step 3 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1306 



PROPOSED RULES 



{2} FLEX Component 1 plus USMLE Step 

3 
(3) National Board Part I or USMLE Step 

1 plus 

National Board Part II or USMLE Step 

2 plus 

FLEX Component 2 

Statutory Authority G.S. 90-6; 90-9: 90-11. 

SECTION .0300 - LICENSE BY 
ENDORSEMENT 

.0305 EXAMINATION BASIS FOR 
ENDORSEMENT 

(a) To be eligible for license by endorsement of 
credentials, graduates of medical schools approved 
by the LCME or AOA must supply certification of 
passing scores on one of the following written 
examinations: 

( 1 ) National Board of Medical Examiners; 

(2) FLEX - under Rule .0314 of this Sec- 
tion; 

(3) Written examination other than FLEX 
from the state board which issued the 
original license by written examination; 
©r 

(4) National Board of Osteopathic Examin- 
ers, all parts taken after January 1 , 
1990ior 

15] USMLE = Step. L, Step 2, Step. 3 of 
USMLE or a combination of examina- 
tions as set out in Rule .0215 of this 
Subchapter. 

(b) Graduates of medical schools not approved 
by LCME or AOA must supply certification of 
passing scores on one of the following written 
examinations: 

(1) FLEX - under Rule .0314 of this Sec- 
tion; er 

(2) Written examination other than FLEX 
from the state board which issued the 
applicant's original license by written 
examination together with American 
Specialty Board certification^ or 

£3} USMLE = Step L Step 2, Step 3 of 



USMLE or a combination of examina- 



tions as set out in Rule .0215 of this 
Subchapter. 
(c) A physician who has a valid and unrestricted 
license to practice medicine in another state, based 
on a written examination testing general medical 
knowledge, and who within the past five years has 
become, and is at the time of application, certified 



or recertified by an American Specialty Board, is 
eligible for license by endorsement. 

(d) Applicants for license by endorsement of 
credentials with FLEX scores that do not meet the 
requirements of Rule .0314 of this Section must 
meet the requirements of Paragraph (c) in this 
Rule. 

Statutory Authority G.S. 90-10; 90-13. 

.0314 PASSING FfcEX EXAM SCORE 

(a) FLEX - Physicians who have taken the 
FLEX examination may be eligible to apply for a 
license by endorsement of credentials if they meet 
the following score requirements: 

( 1 ) FLEX taken before January 1 , 1 983 - A 
FLEX weighted average of 75 or more 
on a single three day examination is 
required. 

(2) FLEX taken after January 1, 1983 - A 
FLEX weighted average of 75 or more 
on a single three day examination, with 
a score not less than 70 on Day I, a 
score not less than 75 on Day II, and a 
score not less than 75 on Day III, is 
required. 

(3) FLEX taken after January 1, 1985: 

(A) A score of at least 75 on FLEX Com- 
ponent I and a score of at least 75 on 
FLEX Component II is required. 

(B) Components may be taken in tandem. 
Any component that is failed may be 
retaken; however. Component II may 
not be taken alone unless the applicant 
has passed Component I within the 
last seven years. 

(C) Both components must be passed 
within seven years of the date of 
taking the initial examination. 

(b) USMLE -_ Physicians who have taken the 
USMLE mas 1 be eligible to apply for a license by 
endorsement of credentials if they meet the follow- 
ing score requirements: 

(1) A score of at least 75 is required on 
Step 3. 

(2) Jhe USMLE Step 3 must be passed 
within seven years of the date of taking 
Step 1. 

(c) Examination Combinations z Physicians who 
have taken combinations of examinations as set out 
in Rule .0215 of this Subchapter may be eligible to 
apply for a license by endorsement of credentials 
if they meet the score requirements of this Rule. 

Statutory Authorirx G.S. 90-6; 90-10: 90-13. 



1307 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



PROPOSED RULES 



.0315 TEN YEAR QUALIFICATION 

(a) To be eligible for license by endorsement of 
credentials, an applicant who has not met one of 
the following qualifications within the past ten 
years of the date of the application to the Board, 
must take the SPEX, or other examination as 
determined by the Board, and attain a score of at 
least 75: 

(1) National Board of Medical Examiners 
certification; 

(2) FLEX Exam scores as required under 
Rule .0314 of this Section; 

(3) SPEX score of at least 75; 

(4) certification or re-certification from a 
specialty board recognized by the 
American Board of Medical Specialties; 
ef 

(5) completion of formal postgraduate 
medical education as required under 
Rule .0313 of this Section; or 

(6) examination combinations as set out in 
Rule .0215 of this Subchapter. 

(b) The SPEX requirement may be waived upon 
receipt of a current AMA Physician' s Recognition 
Award. 

(e) (b) This requirement is in addition to all 
other requirements for licensure and may be 
applied as the Board deems appropriate. 



in North Carolina, and representing that 
the corporation will be conducted in 
compliance with the Professional Cor- 
poration Act and these Rules; 
(6) a certificate (P.C. Form 2) for the 
Executive Secretary or the Assistant 
Executive Secretary of the Board to 
sign certifying that at least one of the 
incorporators and each of the persons 
named as original shareholders is li- 
censed to practice medicine in North 
Carolina, 
(b) The Executive Secretary or Assistant Execu- 
tive Secretary shall review the articles of incorpo- 
ration for compliance with the laws relating to 
professional corporations and with these Rules. If 
they comply, the Executive Secretary or Assistant 
Executive Secretary shall sign P.C. Form 2 and 
return the original articles of incorporation and the 
copy to the incorporators for filing with the Secre- 
tary of State. The executed copy of the articles of 
incorporation shall be retained in the office of the 
Board. If the articles of incorporation are subse- 
quently changed before they are filed with the 
Secretary of State, they shall be re-submitted to the 
Board and shall not be filed with the Secretary of 
State until approved by the Board. 

Statutory Authority G.S. 55B-4; 55B-10; 55B-12. 



Statutory Authority G.S. 90-11; 90-13. 

SUBCHAPTER 32C - PROFESSIONAL 
CORPORATIONS 

.0003 PREREQUISITES FOR 
rNCORPORATION 

(a) Before filing the articles of incorporation for 
a professional corporation with the Secretary of 
State, the incorporators shall file with the Execu- 
tive Secretary of the Board: 

(1) the original articles of incorporation; 

(2) an additional executed copy of the 
articles of incorporation; 

(3) a copy of the articles of incorporation; 

(4) a registration fee of fifty dollars 
($50.00) set by Rule .0008 of this 
Section; 

(5) a certificate (P.C. Form 1) certified by 
all incorporators, setting forth the 
names and addresses of each person 
who will be employed by the corpora- 
tion to practice medicine for the corpo- 
ration, and stating that all such persons 
are duly licensed to practice medicine 



.0006 CHARTER AMENDMENTS AND 
STOCK TRANSFERS 

The following general provisions shall apply to 
all professional corporations to practice medicine: 

(1) All changes to the articles of incorpora- 
tion of the corporation shall be filed 
with the Board for approval before 
being filed with the Secretary of State. 
A copy of the changes filed with the 
Secretary of State shall be sent to the 
Board within ten days after filing with 
the Secretary of State. 

(2) The Executive Secretary or Assistant 
Executive Secretary shall issue the 
certificate (P.C. Form 5) required by 
G.S. 55B-6 when stock is transferred in 
the corporation. P.C. Form 5 shall be 
permanently retained by the corpora- 
tion. The stock books of the corpora- 
tion shall be kept at the principal office 
of the corporation and shall be subject 
to inspection by the Executive Secretary 
or his designee during business hours. 

Statutory Authority G.S. 55B-6; 55B-12. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1308 



RRC OBJECTIONS 



1 he Rules Review Commission (RRC) objected to the following rules in accordance with G.S. 143B- 
30.2(c). State agencies are required to respond to RRC as provided in G.S. 143B-30.2(d). 



ADMINISTRATION 

Motor Fleet Management Division 

/ NCAC 38 .0205 - Accident Reporting 

AGRICULTURE 

Gasoline and Oil Inspection Board 

2 NCAC 42 .0102 - Definitions 

Agency Revised Rule 
2 NCAC 42 .0801 - Purpose and Applicability 

Agency Revised Rule 

Structural Pest Control Division 

2 NCAC 34 .0406 - Spill Control 

Agency Responded 
2 NCAC 34 .0603 - Waivers 

Agency Responded 
2 NCAC 34 .0902 - Financial Responsibility 

Agency Responded 

ECONOMIC AND COMMUNITY DEVELOPMENT 
ABC Commission 

4 NCAC 2R .0702 - Disciplinary Action of Employee 

Rule Returned to Agency 
4 NCAC 2R .1205 - Closing of Store 

Agency Repealed Rule 
4 NCAC 2S .0503 - Pre-Orders 

Rule Returned to Agency 

ENVIRONMENT, HEALTH, AND NATURAL RESOURCES 

Coastal Management 

15 A NCAC 7H .0306 - General Use Standards for Ocean Hazard Areas- 
Rule Returned to Agency 

Departmental Rules 

15A NCAC U .0204 - Loans from Emergency Revolving Loan Accounts 

15A NCAC U .0302 - General Provisions 

15A NCAC U .0701 - Public Necessity: Health: Safety and Welfare 



RRC Objection 09/1 7192 



RRC Objection 08/20/92 

Obj. Removed 08/20/92 

RRC Objection 08/20/92 

Obj. Removed 08/20/92 



RRC Objection 07/16/92 

No Action 08/20/92 

RRC Objection 07/16/92 

No Action 08/20/92 

RRC Objection 07/16/92 

No Action 08/20/92 



RRC Objection 05/21/92 
06/18/92 
RRC Objection 05/21/92 
Obj. Removed 06/18/92 
RRC Objection 05/21/92 
06/18/92 



RRC Objection 05/21/92 
06/18/92 



RRC Objection 06/18/92 
RRC Objection 06/18/92 
RRC Objection 06/18/92 



1309 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



RRC OBJECTIONS 



Environmental Health 

75,4 NCAC 18A .3101 - Definitions 
Agency Revised Rule 

Environmental Management 

15A NCAC 2D .0538 - Control of Ethylene Oxide Emissions 

Agency Revised Rule 
15 A NCAC 2D .1104 - Toxic Air Pollutant Guidelines 

Agency Revised Rule 
15 A NCAC 2G .0601 - The Aquatic Weed Control Act 

Agency Revised Rule 
15A NCAC 20 .0302 - Self Insurance 

Health: Epidemiology 

15A NCAC 19H .0402 - Documentary Evidence: Facts to be Established 

Agency Revised Rule 
15 A NCAC 19H .0601 - Birth Certificates 

Agency Revised Rule 

Soil and Water Conservation 

15 A NCAC 6E .0007 - Cost Share Agreement 
Agency Revised Rule 

Wildlife Resources and Water Safety 

15A NCAC WE .0004 - Use of Areas Regulated 
Agency Revised Rule 

HUMAN RESOURCES 

Aging 

10 NCAC 22R .0301 - Definitions 
Agency Revised Rule 
Agency Revised Rule 

Day Care Rules 

10 NCAC 46D .0305 - Administration of Program 

Agency Revised Rule 
10 NCAC 46D .0306 - Records 

Agency Revised Rule 

Medical Assistance 



RRC Objection 06/18/92 
Obj. Removed 06/18/92 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 



08/20/92 
08/20/92 
08/20/92 
08/20/92 
08/20/92 
08/20/92 
06/18/92 



RRC Objection 08/20/92 

Obj. Removed 08/20/92 

RRC Objection 06/18/92 

Obj. Removed 06/18/92 



RRC Objection 06/18/92 
Obj. Removed 06/18/92 



RRC Objection 06/18/92 
Obj. Removed 08/20/92 



RRC Objection 07/16/92 
RRC Objection 07/16/92 
Obj. Removed 08/20/92 



RRC Objection 06/18/92 

Obj. Removed 06/18/92 

RRC Objection 06/18/92 

Obj. Removed 06/18/92 



10 NCAC 50A .0305 - Appeal Decision 
Agency Revised Rule 

Mental Health: General 

10 NCAC 14C .1010 - Other Contracts 



RRC Objection 08/20/92 
Obj. Removed 08/20/92 



RRC Objection 08/20/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1310 



RRC OBJECTIONS 



Agency Revised Rule 
10 NCAC 14C .1115- Funding Group Homes for Mentally Retarded Adults 

10 NCAC 14M .0704 - Program Director 

Agency Revised Rule 

INSURANCE 

Departmental Rules 

// NCAC 1 .0106 - Organization of the Department 
Agency Revised Rule 

Multiple Employer Welfare Arrangements 

11 NCAC 18 .0019 - Description of Forms 
Seniors' Health Insurance Information Program 

11 NCAC 17 .0005 - SH11P Inquiries to Insurers and Agents 

LABOR 

Occupational Safety and Health Act 

13 NCAC 7 C .0108 - Building Code 

13 NCAC 7 C .0109 - Fire Prevention Code 

LICENSING BOARDS AND COMMISSIONS 

Dietetics/Nutrition 

21 NCAC 17 .0014 - Code of Ethics for Professional Practice/Conduct 
Agency Revised Rule 
Agency Revised Rule 

General Contractors 

21 NCAC 12 .0503 - Renewal of License 
Agency Revised Rule 

REVENUE 

Individual Income, Inheritance and Gift Tax Division 



Obj. Removed 08/20/92 

RRC Objection 08/20/92 

RRC Objection 05/21/92 

Obj. Removed 06/18/92 



RRC Objection 06/18/92 
Obj. Removed 06/18/92 



RRC Objection 06/18/92 



RRC Objection 06/18/92 



RR C Objection 09/1 7/92 
RR C Objection 09/1 7/92 



RRC Objection 05/21/92 
RRC Objection 05/21/92 
Obj. Removed 06/18/92 



RRC Objection 08/20/92 
Obj. Removed 08/20/92 



17 NCAC 3B .0401 - Penalties 
17 NCAC 3B .0402 - Interest 

Individual Income Tax Division 

17 NCAC 6B .0107 - Extensions 

17 NCAC 6B .0115 - Additions to Federal Taxable Income 

17 NCAC 6B .0116 - Deductions from Federal Taxable Income 

17 NCAC 6B .0117 - Transitional Adjustments 

17 NCAC 6B .3406 - Refunds 



RRC Objection 08/20/92 
RRC Objection 08/20/92 



RRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 



08/20/92 
08/20/92 
08/20/92 
08/20/92 
08/20/92 



1311 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



RRC OBJECTIONS 



STATE PERSONNEL 
Office of State Personnel 

25 NCAC IE . 1301 - Purpose RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC IE . 1302 - Policy RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC IE . 1303 - Administration RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC IE . 1304 - Qualifying to Participate in Voluntary Shared Leave Prgm RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC IE . 1305 - Donor Guidelines RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC IE . 1306 - Leave Accounting Procedures RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC 1H .0603 - Special Recruiting Programs RRC Objection 05/21/92 

Agency Repealed Rule Obj. Removed 06/18/92 

25 NCA C 11 .1702 - Employment of Relatives RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC II . 1903 - Applicant Information and Application RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC II .2401 - System Portion I: Recruitment, Selection, & Advancement RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC 11 .2402 - System Portion II: Classification/Compensation RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC 11 .2403 - System Portion III: Training RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC II .2404 - System Portion IV: Employee Relations RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC 11 .2405 - System Portion V: Equal Emp Oppty/ Affirmative Action RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC 11 .2406 - System Portion VI: Political Activity RRC Objection 07/16/92 

Agency Revised Rule Obj. Removed 08/20/92 

25 NCAC U . 1005 - Eligibility for Services RRC Objection 05/21/92 

Agency Revised Rule Obj. Removed 06/18/92 

TRANSPORTATION 
Division of Highways 



19A NCAC 2B .0164 - Use of Right of Way Consultants 
19A NCAC 2B .0165 - Asbestos Contracts with Private Firms 



RRC Objection 
RRC Objection 



09/17/92 
08/20/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1312 



RULES INVALIDATED BY JUDICIAL DECISION 



1 his Section of the Register lists the recent decisions issued by the North Carolina Supreme Court, 
Court of Appeals, Superior Court (when available), and the Office of Administrative Hearings which 
invalidate a rule in the North Carolina Administrative Code. 



1 NCAC 5 A .0010 - ADMINISTRATIVE PROCEDURES 

Thomas R. West, Administrative Law Judge with the Office of Administrative Hearings, declared two portions 
of Rule 1 NCAC 5 A .0010 void as applied in Stauffer Information Systems, Petitioner v. The North Carolina 
Department of Community Colleges and Tlie North Carolina Department of Administration, Respondent and 
Tlie University of Southern California, Intervenor-Respondent (92 DOA 0666). 

15A NCAC 19A .0202(d)(10) - CONTROL MEASURES - fflV 

Brenda B. Becton, Administrative Law Judge with the Office of Administrative Hearings, declared Rule 15A 
NCAC 19A .0202(d)( 10) void as applied In ACT-UP TRIANGLE (AIDS Coalition to Unleash Power Triangle), 
Steven Harris, and John Doe, Petitioners v. Commission for Health Services of the State of North Carolina, 
Ron Levine, as Assistant Secretary of Health and State Health Director for the Department of Environment, 
Health, and Natural Resources of the State of North Carolina, William Cobey, as Secretary of the Department 
of Environment, Health, and Natural Resources of the State of North Carolina, Dr. Rebecca Meriwether, as 
Chief, Communicable Disease Control Section of the North Carolina Department of Environment, Health, and 
Natural Resources, Wayne Babbitt Jr. , as Chief of the HIV/STD Control Branch of the North Carolina 
Department of Environment. Health, and Natural Resources, Respondents (91 EHR 0818). 



t 



< 



1313 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



1 his Section contains the full text of some of the more significant Administrative Law Judge decisions 
along with an index to all recent contested cases decisions which are filed under North Carolina 's 
Administrative Procedure Act. Copies of the decisions listed in the index and not published are available 
upon request for a minimal charge by contacting the Office of Administrative Hearings, (919) 733-2698. 



KEY TO CASE CODES 



ABC Alcoholic Beverage Control Commission DST 

BDA Board of Dental Examiners EDC 

BME Board of Medical Examiners EHR 

BMS Board of Mortuary Science 

BOG Board of Geologists ESC 

BON Board of Nursing HAF 

BOO Board of Opticians HRC 

CFA Commission for Auctioneers IND 

COM Department of Economic and Community INS 

Development LBC 

CPS Department of Crime Control and Public Safety MLK 

CSE Child Support Enforcement NHA 

DAG Department of Agriculture OAH 

DCC Department of Community Colleges OSP 

DCR Department of Cultural Resources PHC 

DCS Distribution Child Support 

DHR Department of Human Resources POD 

DOA Department of Administration SOS 

DOJ Department of Justice SPA 

DOL Department of Labor 

DSA Department of State Auditor WRC 



Department of State Treasurer 
Department of Public Instruction 
Department of Environment, Health, and 
Natural Resources 
Employment Security Commission 
Hearing Aid Dealers and Fitters Board 
Human Relations Committee 
Independent Agencies 
Department of Insurance 
Licensing Board for Contractors 
Milk Commission 

Board of Nursing Home Administrators 
Office of Administrative Hearings 
Office of State Personnel 
Board of Plumbing and Heating 
Contractors 

Board of Podiatry Examiners 
Department of Secretary of State 
Board of Examiners of Speech and Language 
Pathologists and Audiologists 
Wildlife Resources Commission 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Anne R. Gwaltney, Milton H. Askew, Jr. 

and Anna L. Askew 

v. 

EHR and Pamlico County Health Department 


89 DHR 0699 


Reilly 


07/17/92 


Eleanor R. Edgerton-Taylor 

v. 

Cumberland County Department of Social Services 


89 OSP 1141 


Morrison 


08/18/92 


Annette Carlton 

v. 

Cleveland County Department of Social Services 


90 OSP 0024 


Chess 


08/14/92 


Janice Parker Haughton 

v. 

Halifax County Mental Health, Mental Retardation, 

Substance Abuse Program 


90 OSP 0221 


West 


08/18/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1314 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Carolina Water Service, Inc. 

v. 

EHR, Division of Environmental Management 


90 EHR 0415 


West 


09/11/92 


CSX Transportation, Inc. 

v. 

Department of Environment, Health, & Natural Resources 


90 EHR 0628 


Reilly 


07/17/92 


Bruce Keeter 

v. 

Beaufort County Health Department 


90 EHR 0666 


Morgan 


07/28/92 


Christine Hill 

v. 

Crime Victims Compensation Commission 


90 CPS 0876 


Morgan 


08/24/92 


JHY Concord, Inc. 

v. 
Department of Labor 


90 DOL 1421 


Morgan 


07/28/92 


Lick Fork Hills, Inc., Marion Bagwell, President 

v. 

Department of Environment, Health, & Natural Resources 


91 EHR 0023 


Morgan 


07/28/92 


Albert J. Johnson 

v. 

N.C. Victims Compensation Commission 


91 CPS 0038 


Morgan 


07/28/92 


Frank Beal. T/A Wild Wild West 

v. 

Alcoholic Beverage Control Commission 


91 ABC 0164 


Morgan 


09/10/92 


William B. Holden 

v. 

Department of Environment, Health, & Natural Resources 


91 EHR 0176 


Morgan 


08/18/92 


Brenda P. Price 

v. 

North Carolina Central University 


91 OSP0219 


Morrison 


08/21/92 


Century Care of Laurinburg. Inc. 

v. 

DHR. Division of Facility Services, Licensure Section 


91 DHR 0257 


West 


06/30/92 


Richard L. Gainey 

v. 

Department of Justice 


91 OSP 0341 


Becton 


08/10/92 


Wade Charles Brown, Jr. 

v. 

N.C. Crime Victims Compensation Commission 


91 CPS 0345 


Chess 


07/08/92 


Jackie Bruce Edwards 

v. 

DHR, Western Carolina Center 


91 OSP 0354 


West 


08/20/92 



1315 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Robert C. Howell 

v. 

Department of Correction 


91 OSP 0407 


Morgan 


08/26/92 


Charles E. Roe 

v. 

Department of Environment, Health, & Natural Resources 


91 OSP 0520 


Nesnow 


07/23/92 


Jerry J. Parker 

v. 
Department of Correction 


91 OSP 0546 


Morgan 


08/26/92 


Air-A-Plane Corporation 

v. 
Department of Environment, Health, & Natural Resources 


91 EHR 0636 


Nesnow 


09/04/92 


Lisa M. Reichstein 

v. 

Office of Student Financial Aid, East Carolina University 


91 OSP 0662 


Nesnow 


06/24/92 


Hudson's "The Acres" Rest Home 

v. 

DHR, Division of Facility Services, Licensure Section 


91 DHR 0665 


Chess 


09/09/92 


DHR. Division of Facility Svcs, Child Day Care Section 

v. 
Mary Goodwin. Jean Dodd, D/B/A Capital City Day Care 

Center 


91 DHR 0720 


Morgan 


07/30/92 


Kenneth Helms 

v. 

Department of Human Resources 


91 OSP 0729 


Chess 


07/15/92 


Lloyd C. Neely 

v. 

Department of Correction 


91 OSP 0756 


Morgan 


09/10/92 


Alcoholic Beverage Control Commission 

v. 

Daniels Investments, Inc., t/a Leather & Lace - East 

4205 Monroe Road, Charlotte, N.C. 28205 


91 ABC 0799 


Mann 


07/14/92 


Zelma Babson 

v. 

Brunswick County Health Department 


91 OSP 0804 


Gray 


08/14/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1316 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


ACT-UP Triangle (AIDS Coalition to Unleash Power 

Triangle, Steven Harris, and John Doe 

v. 

Commission for Health Services of the State of N.C., Ron 

Levine, as Assistant Secretary of Health and State Health 

Director for EHR of the State of N.C., William Cobey, as 

Secretary of EHR of the State of N.C., Dr. Rebecca 

Meriwether, as Chief, Communicable Disease Control 

Section of the N.C. EHR, Wayne Bobbin, Jr., as Chief of 

the HIV/STD Control Branch of the N.C. EHR 


91 EHR 0818 


Becton 


07/08/92 


Jane C. O'Malley, Melvin L. Cartwright 
v. 
EHR and District Health Department Pasquotank- 
Perquimans-Camden-Chowan 


91 EHR 0838 


Becton 


07/02/92 


Thomas E. Vass 

v. 

James E. Long, Department of Insurance 


91 INS 0876 


Morrison 


08/14/92 


William Paul Fearrington 

v. 

University of North Carolina at Chapel Hill 


91 OSP 0905 


Reilly 


08/28/92 


Gerald R. Pruitt 

v. 

Department of Correction 


91 OSP 0933 


Gray 


09/14/92 


Grotgen Nursing Home, Inc., Britthaven, Inc. 

v. 

Certificate of Need Section, Div of Facility Svcs, DHR 


91 DHR 0964 
91 DHR 0966 


Nesnow 


07/06/92 


Ramona S. Smith, R.N. 

v. 
N.C. Teachers'/St Emps' Comp Major Medical Plan 


91 DST 0984 


Chess 


06/18/92 


Jarrett Dennis Swearengin 

v. 

DHR, Division of Social Services, CSE 


91 CSE 0986 


Becton 


09/14/92 


Charles H. Yates, Power of Attorney for Ruth Yates 

v. 
N.C. Teachers'/St Emps' Comp Major Medical Plan 


91 INS 1008 


Reilly 


08/21/92 


Walter McGlone 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1030 


Morrison 


07/13/92 


William Oscar Smith 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1042 


Gray 


07/24/92 


William Watson 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1047 


Becton 


07/08/92 



1317 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Robert D. Daniels Jr. 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1048 


Morrison 


08/27/92 


Marie McNeill-Pridgen 

v. 

Department of Environment, Health, & Natural Resources 


91 EHR 1059 


Nesnow 


07/17/92 


Catawba Memorial Hospital 

v. 

DHR, Div of Facility Svcs, Certificate of Need Section 

and 
Frye Regional Medical Ctr, Inc. and Amireit (Frye), Inc. 

and 

Thorns Rehabilitation Hospital Health Services Corp. 

and 

Frye Regional Medical Ctr, Inc. and Amireit (Frye), Inc. 

v. 
DHR, Div of Facility Svcs, Certificate of Need Section 

and 

Thorns Rehabilitation Hospital Health Services Corp. 

and 

Catawba Memorial Hospital 


91 DHR 1061 
91 DHR 1087 


Reilly 


07/13/92 


Edward R. Peele 

v. 

Sheriffs' Education & Training Stds. Commission 


91 DOJ 1092 


Morrison 


08/18/92 


Charles Lawton Roberts 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1097 


Becton 


09/14/92 


William Torres 

v. 

Dept of Justice, Lacy H. Thornburg, Attorney General 


91 DOJ 1098 


Morrison 


08/07/92 


Wade A. Burgess 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1114 


Gray 


07/01/92 


Sammie L. Anderson 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1155 


Mann 


09/01/92 


Harry L. King 

v. 

Department of Transportation 


91 OSP 1162 


Morgan 


07/13/92 


Gilbert Lockhart 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1178 


Morrison 


07/30/92 


Isaac H. Galloway 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1190 


Reilly 


06/30/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1318 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Russell A. Barelift 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1207 

92 CSE 0275 


Reilly 


06/30/92 


Barnabas D. Frederick 

v. 

DHR. Division of Social Services. CSE 


91 CSE 1216 


Nesnow 


09/15/92 


Herman Edward Main II 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1225 


Nesnow 


07/07/92 


Albert Louis Stoner III 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1244 


Gray 


07/01/92 


James E. Greene 

v. 

DHR. Division of Social Services, CSE 


91 CSE 1245 


Nesnow 


07/14/92 


Joseph W. Harris 

v. 

DHR. Division of Social Services, CSE 


91 CSE 1247 


Morgan 


07/28/92 


Celvis M. Burns 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1256 


Mann 


09/01/92 


Rodney Powell 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1257 


Morgan 


07/29/92 


Miles G. Griffin Jr. 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1270 


Gray 


08/27/92 


Gerald E. Anthony 

v. 

DHR, Division of Social Services. CSE 


91 CSE 1274 


Mann 


09/01/92 


Floyd L. Rountree 

v. 

DHR. Division of Social Services, CSE 


91 CSE 1275 


Morgan 


07/22/92 


Ruth Smith Hensley Shondales 

v. 

ABC Commission 


91 ABC 1280 


Chess 


08/05/92 


Rasoul Behboudi 

v. 

DHR. Division of Social Services. CSE 


91 CSE 1313 


Morrison 


09/15/92 


City- Wide Asphalt Paving, Inc. 

v. 

Department of Environment. Health, & Natural Resources 


91 EHR 1360 


Chess 


07/01/92 



1319 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Alcoholic Beverage Control Commission 

v. 

Tre Three, Inc., T/A Crackers, 

Airport Rd., Rockingham, NC 28379 


91 ABC 1372 


Chess 


07/07/92 


Alcoholic Beverage Control Commission 

v. 

Rode Enterprises, Inc., T/A Jordan Dam Mini Mart 


91 ABC 1388 


Gray 


07/30/92 


Blythe M. Bragg 

v. 

University of North Carolina at Chapel Hill 


91 OSP 1421 


Nesnow 


09/08/92 


David W. Williams 

v. 

DHR, Division of Social Services, CSE 


91 CSE 1423 


Morrison 


09/10/92 


Donald R. Allison 

v. 

DHR, Caswell Center 


91 OSP 1427 


Reilly 


06/30/92 


Alfred Rees 

v. 

Department of Environment, Health, & Natural Resources 


92 EHR 0004 


Reilly 


09/03/92 


Mrs. S. 

v. 

Washington County Board of Education 


92 EDC 0023 


Mann 


08/28/92 


Rudolph Tripp 

v. 

Department of Correction 


92 OSP 0024 


Gray 


08/27/92 


Lavern Fesperman 

v. 
Mecklenburg County 


92 OSP 0030 


Chess 


07/17/92 


Paul J. Nonkes 

v. 

Halifax County Health Dept. (Jeff Dillard, Sanitarian) 


92 EHR 0058 


Becton 


08/28/92 


Carrolton of Williamston, Inc. 

v. 

DHR, Division of Facility Services, Licensure Section 


92 DHR 0071 


Becton 


08/19/92 


Fred Jennings Moody Jr. 

v. 

Sheriffs' Education & Training Stds. Commission 


92 DOJ 0084 


Chess 


07/17/92 


Ronnie Lamont Donaldson 

v. 

Sheriffs' Education & Training Standards Commission 


92 DOJ 0092 


Reilly 


07/27/92 


Vernice V. Battle 

v. 

Sheriffs' Education & Training Standards Commission 


92 DOJ 0093 


Becton 


08/28/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1320 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Hudson's "The Acres" Rest Home 

v. 

DHR, Division of Facility Services, Licensure Section 


92 DHR 0100 


Chess 


09/04/92 


Marvin Helton, Jean Helton 

v. 

DHR, Division of Facility Services 


92 DHR 0102 


Chess 


08/14/92 


Leo Scott Wilson 

v. 

Department of Environment, Health, & Natural Resources 


92 EHR0112 


Reilly 


08/26/92 


Peggy N. Barber 

v. 

The University of North Carolina at Chapel Hill 


92 OSP 0120 


Reilly 


07/13/92 


Alcoholic Beverage Control Commission 

v. 

John Wade Lewis, t/a Tasty Grill 


92 ABC 0145 


Nesnow 


07/15/92 


Licensing Board for General Contractors 

v. 

Wright's Construction. Inc. (Lie. No. 23065) 


92 LBC 0172 


Gray 


07/31/92 


Richard L. Banks 

v. 

Pasquotank-Perquimans-Camden-Chowan District Health 

Department (PPCC) & Department of Environment, 

Health, & Natural Resources 


92 EHR0175 


West 


08/25/92 


Hudson's "The Acres" Rest Home 

v. 

DHR, Division of Facility Services, Licensure Section 


92 DHR 0186 


Chess 


09/04/92 


Ray Bryant 

v. 

Department of Labor, OSHA 


92 DOL 0187 


Nesnow 


08/07/92 


Herbert Hines Jr., H & H 

v. 
Alcoholic Beverage Control Commission 


92 ABC 0189 


Becton 


07/22/92 


William Stevenson 

v. 

Department of Correction 


92 OSP 0201 


Chess 


09/03/92 


Frances B. Billingsley 

v. 

Bd. of Trustees/Teachers & St Employees Retirement Sys 


92 DST 0205 


Morgan 


08/18/92 


Glenn E. Myers 

v. 
Department of Correction 


92 OSP 0217 


Reilly 


09/14/92 



1321 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Lawrence Neal Murrill T/A Knox, 507 1st St SW, 

Hickory, NC 28602 

v. 

Alcoholic Beverage Control Commission 


92 ABC 0220 


Chess 


08/03/92 


Town of Denton 

v. 

Department of Environment, Health, & Natural Resources 


92 EHR 0241 


Reilly 


07/30/92 


Alcoholic Beverage Control Commission 

v. 

Byrum's of Park Road, Inc., T/A Byrum's Restaurant 


92 ABC 0252 


Gray 


07/30/92 


Alcoholic Beverage Control Commission 

v. 
Leo's Delicatessen #2, Inc., T/A Leo's #2 


92 ABC 0255 


Gray 


07/30/92 


North Topsail Water & Sewer, Inc. 

v. 

Department of Environment, Health, & Natural Resources 


92 EHR 0266 


Morrison 


08/12/92 


Henry Thomas Tart 

v. 

DHR, Division of Social Services, CSE 


92 CSE 0283 


Nesnow 


09/15/92 


Henry Lane, D/B/A Emerald Health Care Acute Care Ctr 

v. 
DHR, Div of Facility Services, Certificate of Need Section 

and 

Bowman-Richardson Health Care, Inc. D/B/A Wilkes 

Senior Village 


92 DHR 0308 


Gray 


08/28/92 


Gerald G. Strickland 

v. 

Crime Control and Public Safety 


92 CPS 0320 


Chess 


09/10/92 


Jonathan L. Fann 

v. 

U.N.C. Physical Plant. Herb Paul, Louis Herndon, Dean 

Justice, Bruce Jones 


92 OSP 0363 


Becton 


08/19/92 


Douglas A. Bordeaux 

v. 

Department of Correction 


92 OSP 0378 


Chess 


07/10/92 


Clifton R. Johnson 

v. 

O'Berry Center, Department of Human Resources 


92 OSP 0381 


West 


07/08/92 


Southeastern Machine & Tool Company, Inc. 

v. 

Department of Environment. Health, & Natural Resources 


92 EHR 0386 


Becton 


07/20/92 


Louvenia Clark 

v. 

Edgecombe County Department of Social Services 


92 OSP 0402 


Reilly 


08/21/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1322 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Raleigh F. LaRoche 

v. 

Child & Family Services of Wake County 


92 OSP 0409 


Becton 


08/24/92 


Paul Reeves, Youth University Child Care 

v. 

Child Day Care Section, Division of Facility Svcs 


92 DHR 0424 


West 


08/21/92 


Mr. & Mrs. James C. Stanton 

v. 

Charlotte-Mecklenburg School System 


92 EDC 0430 


Nesnow 


08/04/92 


James Cooper Lewis 

v. 

Sheriffs' Education & Training Standards Commission 


92 DOJ 0461 


Reilly 


09/15/92 


Jon David Amundson 

v. 

Davidson County Mental Health 


92 OSP 0503 


Becton 


09/10/92 


Northview Mobile Home Park 

v. 

Department of Environment, Health, & Natural Resources 


92 EHR 0507 


Reilly 


07/13/92 


Yolanda Lynn Bethea 

v. 

DHR, Division of Social Services, CSE 


92 DCS 0513 


Becton 


08/14/92 


Alice Hunt Davis 

v. 

Department of Human Resources 


92 OSP 0526 


West 


07/16/92 


Jimmy F. Bailey Sr. 

v. 

Department of State Treasurer, Retirement Systems Div 


92 DST 0536 


Morgan 


08/18/92 


Bramar, Inc., t/a Spike's 

v. 

Alcoholic Beverage Control Commission 


92 ABC 0554 


Mann 


08/13/92 


Ralph J. Ogburn 

v. 

Private Protective Services Board 


92 DOJ 0571 


Nesnow 


08/07/92 


Gilbert Todd Sr. 

v. 

Public Water Supply Section 


92 EHR 0586 


Morrison 


08/06/92 


Candance Y. Johnson 

v. 

Division of Motor Vehicles 


92 DOT 0589 


Becton 


08/24/92 


John W. Surles 

v. 

N.C. Crime Victims Compensation Commission 


92 CPS 0595 


Reilly 


07/ 1 3/92 



1323 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Pamela Jean Gass 

v. 

DHR, Division of Social Services, CSE 


92 DCS 0623 


Morrison 


08/14/92 


J.W. Reed 

v. 
Department of Correction 


92 OSP 0638 


Morrison 


08/11/92 


Carson Davis 

v. 

Department of Correction 


92 OSP 0650 


Reilly 


08/10/92 


Luther Hall Clontz 

v. 

Western Carolina Center (NC of Human Resources) 


92 OSP 0652 


Becton 


09/10/92 


Private Protective Services Board 

v. 

Mark Andrew Perry 


92 DOJ 0662 


Becton 


09/10/92 


Stauffer Information Systems 

v. 

Department of Community Colleges and the N.C. 

Department of Administration 

and 

The University of Southern California 


92 DOA 0666 


West 


07/08/92 


Nancy J. Tice 

v. 

Administrative Off of the Courts, Guardian Ad Litem Svcs 


92 OSP 0674 


Morrison 


08/11/92 


L. Stan Bailey 

v. 

Chancellor Moran and UNC-Greensboro 


92 OSP 0679 


West 


07/10/92 


Arnold McCloud T/A Club Castle 

v. 

Alcoholic Beverage Control Commission 


92 ABC 0681 


Morrison 


07/25/92 


Joyce Faircloth, T/A Showcase Lounge 

v. 
Alcoholic Beverage Control Commission 


92 ABC 0713 


Morrison 


07/25/92 


James B. Price 

v. 

Department of Transportation 


92 OSP 0725 


Mann 


09/02/92 


Edmonia Lang 

v. 

Carteret County Board of Education 


92 OSP 0736 


Mann 


08/28/92 


Larry Bruce High 

v. 

Alarms Systems Licensing Board 


92 DOJ 0755 
92 DOJ 0785 


Nesnow 


08/25/92 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1324 



CONTESTED CASE DECISIONS 



CASE NAME 


CASE 
NUMBER 


ALJ 


FILED 
DATE 


Daniel N. Jones 

v. 

N.C. Victims Compensation Commission 


92 CPS 0879 


Chess 


08/28/92 



* 



7325 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



STATE OF NORTH CAROLINA 



COUNTY OF JOHNSTON 



IN THE OFFICE OF 
ADMINISTRATIVE HEARINGS 
90 EHR 0415 



CAROLINA WATER SERVICE, 
Petitioner 



INC. 



NORTH CAROLINA DEPARTMENT OF 
ENVIRONMENT, HEALTH AND 
NATURAL RESOURCES, DrVlSION OF 
ENVIRONMENTAL MANAGEMENT 
Respondent 



RECOMMENDED DECISION 



The above-captioned matter was heard by Thomas R. West, Administrative Law Judge, on February 
3, 1992, in Raleigh, North Carolina. 



For Petitioner: 
For Respondent: 



APPEARANCES 

Edward S. Finley, Jr., James L. Hunt, Hunton and Williams 
Elizabeth Rouse Mosley, Associate Attorney General 



ISSUES 

1 . Whether the Respondent (DEM) lacked authority or acted arbitrarily or capriciously in setting 
a total phosphorus limit at 0.1 mg/1, including the use of the "Mass Balance Model," for effluent discharges 
of 250,000 gallons per day (gpd) and 500,000 gpd. 

2. Whether the Respondent lacked authority or acted arbitrarily or capriciously in requiring 
Petitioner to take daily downstream samples at the spillway of Austin Pond. 



STIPULATED FACTS 

The parties stipulated in the Final Prehearing Order that the following facts are true: 



1 . On August 14, 1989, the Petitioner (CWS) filed an application with the Respondent to renew 
an existing National Pollution Discharge Elimination System (NPDES) permit to operate a surface discharge 
wastewater treatment plant in the White Oak Subdivision of Johnston County. 

2. Petitioner's previous NPDES permit, dated September 2, 1988, allowed Petitioner (1) to 
operate an existing 50,000 gpd wastewater facility, (2) to expand this plant to 140,000 gpd after receiving 
appropriate Authorization to Construct, and (3) after receiving appropriate Authorization to Construct, to build 
and operate a 500,000 gpd facility at a separate outfall on White Oak Creek. The permit did not contain any 
limitations on total phosphorus discharge. 

3. Petitioner's system was first permitted to then owner, White Oak Plantation, Inc. ("White Oak 
Plantation"), in February, 1985. The initial permit set an effluent limit of 50, 000 gpd. In September, 1986, 



7:13 NORTH CAROLINA REGISTER October 7, 1992 



1326 



CONTESTED CASE DECISIONS 



White Oak Plantation applied for and received a modified permit allowing an immediate effluent flow of up 
to 50,000 gpd, with stepwise increases to 140,000 gpd and 500,000 gpd. In January, 1987, White Oak 
Plantation received a third permit, which allowed it (1) to continue to operate the existing 50,000 gpd facility, 
(2) after receiving Authorization to Construct from DEM, to expand the existing plant to a 140,000 gpd 
facility, and (3) after receiving Authorization to Construct from DEM, to build a separate facility with design 
capacity of 500,000 gpd. The 1985, 1986, and 1987 permits did not contain any limitations on total 
phosphorus discharge. 

4. At latitude 353850, longitude 783121, the summer 7Q 10 of White Oak Creek is 0.10 cfs, the 
winter 7Q10 of White Oak Creek is 0.82 cfs, and the average stream flow of White Oak Creek is 10.00 cfs. 

5. On March 19, 1990, the Respondent issued a permit which allowed Petitioner to continue to 
operate the existing 50,000 gpd plant at White Oak. This permit provided for two possible discharge points: 
(1) at the existing site on an unnamed tributary to White Oak Creek, and (2) to a new outfall on White Oak 
Creek proper. The permit eliminated the stepwise increases to 140,000 gpd and 500,000 gpd contained in 
the 1986, 1987, and 1988 permits. 

6. On April 23, 1990, the Petitioner filed its petition for a contested case. 

7. After settlement negotiations. Respondent and Petitioner agreed that the permit submitted 
March 19, 1990, could be issued with the following additional conditions: 

a. Stepwise increases, after issuance of authorization to Construct, would allow effluent 
discharges of 250,000 gpd and 500,000 gpd. 

b. Permit issuance is subject to public review via standard public noticing procedures. 

c. Permittee will provide an on-site operator with appropriate educational and certification 
requirements for daily operation and maintenance checks on the proposed, highly advanced 
waste treatment plant (i.e. for the 250,000 and 500,000 gpd discharges). Effluent total 
phosphorus (TP) concentrations should be measured on a daily basis, as should the other 
parameters typically included for a Class III facility (with one site exception). 

d. Permittee agrees to relocate the WWTP outfall pipe (for the 250,000 gpd and 500,000 gpd 
facilities) to White Oak Creek at a distance of approximately 1 .5 miles above Austin Pond 
at a latitude of 353850 and a longitude of 783121 (original permitted site). 

e. Permittee agrees to perform instream monitoring to provide information deemed necessary 
by the Division (with one site exception) to evaluate instream impacts related to the facility's 
discharge. A reopener clause will be placed in the permit to allow for permit revision or 
revocation upon demonstration of significant instream water quality impacts (i.e. frequent or 
severe water quality standard violations). 

f. Permittee must provide a sludge management plan (including details regarding quantity, 
handling and disposal) for approval by DEM prior to NPDES permit issuance for the 
expanded flows. 

g. Permittee shall provide dual path treatment and stand-by power or other equivalent reliability 
measures as approved by the Division. 



FINDINGS OF FACT 

Based upon the evidence admitted at the hearing, the undersigned Administrative Law Judge finds the 
following facts: 



1327 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



1 . CWS operates approximately 35 sewage treatment plants in North Carolina, including the 
plant at White Oak. 

2. White Oak is a residential subdivision in Johnston County with about 123 single family 
homes. 

3. When CWS purchased the water and sewer system at White Oak in January, 1988, CWS 
obtained a copy of the existing NPDES permit. CWS paid $50,000 for the White Oak system. CWS 
promised the developer that it would provide sewer service to the entire 1,000 acres in the White Oak tract. 
In order to serve the entire tract, CWS will require a permit with a greater than 50,000 gpd effluent limit. 



4. CWS was required to obtain a Certificate of Public Convenience and Necessity from the 
North Carolina Utilities Commission before it could purchase and operate the facility. CWS has received a 
Certificate of Public Convenience and Necessity from the Utilities Commission to operate the White Oak 
facility. 

5. Since purchasing the system, CWS has improved the sewage treatment facilities. At the time 
of purchase, the tertiary filter at the plant was off-line, only one of the two blowers was operational, and the 
surge tank was not operating properly. After CWS' purchase, however, a DEM inspection in March, 1989, 
indicated that the system was in total compliance with all effluent limitations and monitoring requirements. 
The regional water quality supervisor for the Raleigh district reported on April 18, 1989, that the facility was 
well maintained and operated. 

6. When CWS first obtained the permit for the White Oak facility in September, 1988, no issues 
were raised that suggested DEM should change the existing effluent limitations. 

7. Part III of Petitioner's September 2, 1988, NPDES permit stated that "Upon expiration of this 
permit [January 31, 1990], the permit shall be renewed with a phosphorous limit of 2.0 milligrams per liter 
for the 0.500 MGD phase of the treatment plant. This limitation must be met by May 1, 1993, or upon the 
start-up of the 0.500 MGD phase of the treatment plant after May 1, 1993." As a result, in 1988, DEM 
issued a permit to Petitioner stating that upon expiration of that permit, the permit would be renewed with 
a phosphorus limit significantly higher than sought by Petitioner in this contested case. 

8. DEM did not inform CWS, in writing, until July 26, 1990, that the reason it had denied 
CWS' application was because of the potential for excessive eutrophication of the downstream Austin Pond. 
DEM indicated, at that time, that a reduction of total phosphorus to 0.5 mg/1 was the maximum level that 
DEM considered reasonably achievable. 

9. DEM has indicated that its concern in this case was, and is, the potential impact on Austin 
Pond as opposed to White Oak Creek. 

10. CWS did not apply for an "expanded" effluent discharge in the contested permit. Since 1986, 
the permits for White Oak have allowed discharges of up to 500,000 gpd, the same amount requested by CWS 
in this case. On the other hand, DEM seeks to reduce the effluent flow previously allowed CWS at White 
Oak. 

1 1 . After CWS filed a contested case, DEM indicated that it did not believe CWS could meet a 
proposed phosphorus standard of 0.1 mg/1 phosphorus. 

12. CWS submitted engineering information and other data which helped persuade DEM that 
CWS could meet a proposed phosphorus standard of 0.1 mg/1 phosphorus. 

13. In this proceeding, CWS has stipulated that it would agree to reduce the level of phosphorus 
discharge to 0.5 mg/1 at 250.000 gpd and 0.2 mg/1 at 500,000 gpd. A CWS affiliate has consistently met 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1328 



CONTESTED CASE DECISIONS 



a 0.18 mg/1 phosphorus standard at a wastewater treatment plant in Virginia. 

14. The proposed discharge point on White Oak Creek proper is roughly 1.5 miles above the 
headwaters of Austin Pond. 

15. Just below the proposed discharge point, but above Austin Pond, the White Oak Creek 
traverses a swampy area. 

16. The water quality standards in Austin Pond at issue in this case are: chlorophyll a, dissolved 
oxygen, and dissolved gases. 

17. CWS presented the testimony of Dr. Clifford W. Randall, a chaired professor of civil 
engineering and Chairman of the Environmental Engineering and Sciences Program at Virginia Polytechnic 
Institute and State University. Dr. Randall is director of the Occoquan Watershed Monitoring program and 
was appointed to the executive committee of the Chesapeake Bay Water Quality Project, both of which are 
eutrophication control programs. Dr. Randall has extensive experience in designing wastewater treatment 
plants. Dr. Randall was named "Conservationist of the Year" by the Chesapeake Bay Foundation for his 
efforts to prevent nutrient pollution in Chesapeake Bay. Dr. Randall has published a large number of works 
on phosphorus removal and on the science of eutrophication. Dr. Randall is an expert on the subjects of 
eutrophication, water pollution, water treatment and nutrient removal. 

18. In preparing for testimony. Dr. Randall reviewed the existing and proposed NPDES permits 
for White Oak Creek, the wasteload allocation procedures of DEM, and inspected the treatment plant at White 
Oak and Austin Pond. 

19. Eutrophication is the excessive fertilization of a body of water which results in rapid growth 
of plants such as algae and rooted aquatic vegetation. 

20. In order for accelerated eutrophication to occur in impounded waters, including Austin Pond, 
nutrients such as phosphorus must be present. Sunlight and favorable temperatures are also necessary for 
accelerated eutrophication. Other factors include the depth of the impoundment, the shape and size of the 
impoundment, and the retention time of water in the impoundment. Wastewater discharges contain 
phosphorus. 

21 . Wastewater plants are capable of removing large amounts of phosphorus before discharge into 
receiving waters. Phosphorus removal processes can consist of biological removal, chemical additions, and 
filters. Phosphorus levels can be reduced to 0.35 mg/1 without any chemical addition. Technology exists 
to reduce phosphorus levels below 0.1 mg/1. 

22. Only about two to three percent in expense would be added to the cost of a plant to comply 
with phosphorus limits of about 0.35 mg/1. To reach phosphorus limits of about 0.10 mg/1, however, the 
cost of the plant would be increased by about seventy percent, and the operating costs of the plant would be 
increased by about one hundred percent. 

23. CWS" rates and charges are established by the North Carolina Utilities Commission. The 
increased costs of differing levels of phosphorus removal would likely be passed directly to CWS' North 
Carolina customers. 

24. The " Vollenweider Model" is a predictive device used to determine the likelihood of excessive 
eutrophication. The model uses as variables the amount of phosphorus loading into an impoundment and the 
retention time of water in the subject impoundment. Although the use of the Vollenweider Model appears to 
be erroneous because it utilizes annual phosphorus loading and does not account for low stream levels during 
the warmest weeks of the year, the Vollenweider model has been found to accurately predict eutrophication 
in impoundments in North America and in Europe, including lakes in North Carolina, Georgia, Tennessee 
and Florida. The Vollenweider Model is an accepted method in the scientific community in predicting 



1329 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



eutrophication in impoundments such as Austin Pond and has been endorsed by the EPA. The Vollenweider 
criteria are empirically related to eutrophication in lakes in the southeastern United States. 

25. No eutrophic conditions at Austin Pond are predicted by the Vollenweider Model if the 
phosphorus discharge does not exceed 0.5 mg/1 at 250,000 gpd or 0.2 mg/1 at 500,000 gpd. 

26. Several variables not addressed by the Vollenweider Model suggest that under the facts in 
this case eutrophication in Austin Pond is even less likely than predicted by the Vollenweider Model. Normal 
in-stream processes tend to remove phosphorus from a stream. The upstream swamp can absorb much of the 
discharged phosphorus. Eutrophication is less likely in a small pond because of the shallowness of the pond 
and the shorter water retention time. 

27. Phosphorus levels in Austin Pond will not generate eutrophic conditions if the phosphorus 
discharge from Petitioner's plant does not exceed 0.5 mg/1 at 250,000 gpd or 0.2 mg/1 at 500,000 gpd. 

28. There is currently no excessive eutrophication in Austin Pond. 

29. The phosphorus concentrations in White Oak Creek will actually be reduced from those 
currently permitted by DEM at discharge levels of 250.000 gpd and 500,000 gpd under the limitations 
proposed by the Petitioner. 

30. DEM did not utilize the Vollenweider Model. 

31. Although DEM's use of the 7Q10 of White Oak Creek in determining that phosphorus limits 
above 0.1 mg/1 would permit eutrophication of Austin Pond appears to be logical, DEM's analyses of the 
potential for eutrophication in Austin Pond were flawed in several respects. 

32. DEM's use of the 7Q10 for White Oak Creek erroneously assumes that attainment of 0.1 
mg/1 total phosphorus in White Oak Creek is necessary to prevent eutrophication. The waters of White Oak 
Creek flow into Austin Pond, thereby mixing the creek water with pond water which contain substantially 
lower levels of phosphorus per liter. 

33. The retention time of water in Austin Pond is greater than seven days. It is, therefore, not 
logical to use the 7Q10 figure for White Oak Creek to measure phosphorus concentrations in an entirely 
separate body of water, Austin Pond. 

34. DEM's reliance on a 0.1 mg/1 phosphorus target for Austin Pond is inappropriate. A level 
of 0. 1 mg/ 1 phosphorus has been correlated with eutrophic conditions in only one of at least four DEM studies 
of large lakes. In that one instance, the 0.1 mg/1 measurement was taken while algae were in bloom. A 
correct correlation between chlorophyll a and phosphorus concentrations cannot be made in an algae bloom. 
Moreover, the DEM study that obtained a 0.1 mg/1 measurement was made downstream of a discharge of 
millions of gallons of wastewater in the Eno River not subject to any phosphorus restrictions. 

35. DEM's assumption that a localized zone in a large lake is analogous to Austin Pond is without 
basis in fact. 

36. The mass balance model is designed to measure phosphorus concentrations in a stream and 
not in an impoundment. DEM did not use the mass balance model in an appropriate manner. 

37. The mass balance model as used by DEM does not determine the likelihood of eutrophication 
under 7Q10 conditions in Austin Pond in a reliable manner. 

38. DEM did not collect actual in-pond data at Austin Pond. 

39. Petitioner will decrease the loading of phosphorus into Austin Pond at the levels it seeks 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1330 



CONTESTED CASE DECISIONS 



compared to the levels now permitted by DEM. 

40. DEM's decision not to grant the permit at issue is inconsistent with other similar permitting 
decisions. 

41. DEM has never imposed a 0.1 mg/1 standard on an expanding plant, even for plants 
discharging into lake headwaters tested by DEM for eutrophication. This includes the 4. 14 MGD Henderson 
plant at Nutbush Creek, effluent from which is dominating the stream and is affecting Kerr Lake. DEM's 
testimony indicated that it was willing to permit an expansion for this plant with phosphorus concentrations 
more than five times the alleged 0.1 mg/1 standard. 

42. There is no evidence that CWS has legal access to the land surrounding Austin Pond, 
including land adjacent to the pond's spillway. Indeed, the only evidence is that the pond and the land 
surrounding it are privately owned. 

43. There is no evidence that CWS has been permitted or invited to enter the land surrounding 
Austin Pond. 



CONCLUSIONS OF LAW 

1 . CWS' certificate of public convenience and necessity issued by the North Carolina Utilities 
Commission gives CWS a monopoly to provide private sewer service in White Oak. The certificate requires 
CWS to provide reasonable service to every customer in the 1.000 acre White Oak tract. 

2. North Carolina dischargers to surface waters are required to obtain permits from DEM before 
discharging wastewater. 

3. DEM acted erroneously, arbitrarily, and capriciously in denying the permit with phosphorus 
limits of 0.5 mg/1 at 250.000 gpd and 0.2 mg/1 at 500,000 gpd. 

4. Given the absence of evidence of ownership, CWS does not have legal authority to enter the 
private property of the owner of Austin Pond, including the land adjacent to the spillway at Austin Pond, to 
perform water monitoring. 

5. DEM acted without legal authority in attempting to require CWS to take daily downstream 
samples at the spillway and acted arbitrarily and capriciously in attempting to impose such a monitoring 
requirement. 



RECOMMENDED DECISION 

It is recommended that the Respondent issue the Petitioner a N'PDES permit to operate a surface 
discharge wastewater treatment plant at White Oak Subdivision in Johnston County with the following 
conditions: 

a. Stepwise increases, after issuance of Authorization to Construct, to allow effluent discharges 
of 250,000 gpd and 500,000 gpd. Total Phosphorus limitations will be 0.5 mg/1 for the 
250.000 gpd plant and 0.2 mg/1 for the 500.000 gpd discharge. No other effluent limitations 
are at issue in this case. Monitoring requirements at the Spillway at Austin Pond shall be 
eliminated. 

b. Permit issuance is further subject to the stipulations of the parties. 



1331 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



ORDER 

It is hereby ordered that the agency serve a copy of the final decision on the Office of Administrative 
Hearings, P.O. Drawer 27447, Raleigh, N.C. 2761 1-7447, in accordance with North Carolina General Statute 
150B-36(b). 



NOTICE 

The agency making the final decision in this contested case is required to give each party an 
opportunity to file exceptions to this recommended decision and to present written arguments to those in the 
agency who will make the final decision. G.S. 150B-36(a). 

The agency is required by G.S. 150B-36(b) to serve a copy of the final decision on all parties and to 
furnish a copy to the parties' attorney of record and to the Office of Administrative Hearings. 

The agency that will make the final decision in this contested case is the North Carolina Department 
of Environment, Health and Natural Resources. 

This the 1 1th day of September, 1992. 



Thomas R. West 
Administrative Law Judge 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1332 



CONTESTED CASE DECISIONS 



STATE OF NORTH CAROLINA 



COUNTY OF WASHINGTON 



IN THE OFFICE OF 
ADMINISTRATIVE HEARINGS 
92 EDC 0023 



MRS. S. 1 



Petitioner 



vs. 



WASHINGTON COUNTY BOARD 
OF EDUCATION, 

Respondent 



FINAL DECISION 



This contested case was heard in Greenville, Pitt County, North Carolina, on the 28th day of May, 
1992 and continued by agreement of counsel to the 8th day of June, 1992. The hearing was concluded in 
Plymouth. Washington County, North Carolina, on the 9th and 10th days of June, 1992. The record closed 
with the filing of Proposed Findings and Conclusions of Law on July 10, 1992. 



APPEARANCES 



For Petitioner: 



Jack Hansel 

Pamlico Sound Legal Service 

Greenville, North Carolina 



Roger Manus 

Carolina Legal Assistance 

Raleish. North Carolina 



I 



For Respondent: 



Maynard Harrell 
Attorney At Law 
Plymouth. North Carolina 



WITNESSES 



For Petitioner: 



Raymond E. Webster 

(expert witness in fields of child psychology, school 

psychology, neuropsychology, and special education) 
Mrs. S. 



For Respondent: 



Peggy Davenport 
Susan Styons 
Alta Allen 
Ileana Perez 
Darrell Beetle 
Randall Spier 
Katherine Pharr 



Pursuant to Petitioner's request made through counsel by pleading filed with the Office of Administrative 
Hearings (OAH) on July 17. 1992. the initials of this child and his parents will be utilized to protect their right 
to confidentiality. 



1333 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



Jim Lloyd 
Sandra Rhodes 
Shirley Kuhn 



EXHIBITS 

For Petitioner: Petitioner's Exhibit #1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14. 15, 16, 

17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27 and 28 

For Respondent: None 



ISSUES 

1 . Whether the Washington County Board of Education has failed to provide G.E.S.* with a free 
and appropriate education through an appropriate individualized education program pursuant to State and 
federal law. 

2. Whether the Washington County Board of Education has denied G.E.S. his right to a free 
appropriate education by failing to provide him the necessary related services he requires to receive an 
appropriate education. 

3. Whether or not G.E.S.'s individualized education plan is otherwise appropriate to meet his 
needs . 

4. Whether or not G.E.S.'s individualized education plan is being implemented to meet his 
needs . 

STIPULATIONS 

The Stipulations are contained in the Prehearing Order and as further stipulated and defined in the 
record and are set out in this decision. 

FINDE\GS OF FACT 

1 . The Office of Administrative Hearings has jurisdiction over the parties and the subject matter 
of this contested case pursuant to Chapters 115C and 150B of the North Carolina General Statutes. 

2. Mrs. S. (Petitioner) is a citizen and resident of Roper, Washington County, North Carolina 
and is the mother and responsible parent (along with her husband Mr. S.*) for their minor child. 

3. G.E.S.'s date of birth is March 3, 1982, and he has completed grade level three at Pines 
Elementary School, Plymouth, Washington County, North Carolina. 

4. G.E.S. has from birth suffered from a diffuse encephalopathy with bifrontal dysfunction 
associated with medical complications at delivery, apparently caused by subarachnoid hemorrhage. 

5. Respondent is the local education agency responsible for providing a free, appropriate public 
education to G.E.S. 

6. In a report prepared by Becky H. Taylor, Center Director for the Sylvan Learning Center, 
Greenville, North Carolina, in May of 1990, she concludes that G.E.S. tires easily and becomes quite 
frustrated in situations that are not tailored to meet his needs. This conclusion is adopted as a finding of fact 
and is quoted as follows: 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1334 



CONTESTED CASE DECISIONS 



"He tires easily and becomes quite frustrated in situations that are not tailored to meet 
his needs." (See Petitioner's Exhibit #15) 

7. On or about August 14, 1990, G.E.S. was seen by Dr. Theodore R. Sunder, M. D., 
Associate Professor and Chief of Pediatric Neurology at East Carolina University. Dr. Sunder diagnosed 
G.E.S.'s medical condition as diffuse encephalopathy with bifrontal dysfunction. In his report of August 14, 
1990, he concludes that G.E.S. will require behavioral therapy. Dr. Sunder's conclusion is adopted as a 
finding of fact. (Petitioner's Exhibit #3) 

"In addition, he will require behavioral therapy, likely by an organic psychologist with 
some experience in working with head injured individuals." 

8. Prior to G.E.S.'s transfer to the jurisdiction of the Respondent, Washington County Board 
of Education from the Martin County Board of Education in mid term of the second grade, G.E.S. was 
provided education pursuant to his IEP. He was designated EMH. 

9. On or about January 4. 1991, G.E.S. was recommended by Respondent for placement in a 
special education program and to continue the designation in the EMH category. This designation was not 
objected to by Petitioner. (See Petitioner's #11) 

10. During the second grade year G.E.S. began to manifest symptoms of headaches, upset 
stomach and behavior problems. Petitioner expressed her concerns to Mrs. Peggy Davenport, Exceptional 
Children's Director of the Respondent in her correspondence to her dated February 4, 1991. Specifically, 
her observations, which are taken as findings as to her assessment of G.E.S.'s symptoms are quoted as 
follows: 

"Apparently, his needs are not being met because there are obvious signs of frustration 
and low self esteem. G.E.S. is experiencing headaches, upset stomach and behavior 
problems not only at home but at school as well." (See Petitioner's Exhibit #9) 

11. In a separate letter to Mrs. Peggy Davenport under date of February 14, 1991, Petitioner 
objected to Respondent's refusal to approve an independent evaluation of G.E.S. and requested mediation. 
(See Petitioner's Exhibit #9) 

12. Pursuant to a recommendation contained in Respondent's committee report dated February 
12, 1991 (see Petitioner's Exhibit #9), a psychological evaluation was performed by Shirley P. Kuhn, MS, 
Psychological Associates, 400 W. 16th Street, Washington, North Carolina. Ms. Kuhn had in her possession 
Dr. Sunder's diagnosis and recommendations. Inasmuch as Ms. Kuhn refers to Dr. Sunder's diagnosis and 
recommendations, this reference is adopted as a finding that Ms. Kuhn was aware of Dr. Sunder's diagnosis 
and report. Ms. Kuhn, in her report to Respondent, writes: 

"His (Dr. Sunder) recommendations spanned the gambit of special services, including 
speech/language, physical, and occupational therapy as well as behavior therapy and 
management, all integrated into a highly structured academic program in a self- 
contained learning disabilities classroom setting." (See Petitioners Exhibit #13) 

13. Notwithstanding the presence of the diagnosis found by Dr. Sunder and his recommendations, 
Ms. Kuhn rejected the recommendation of a further neuropsychological evaluation of G.E.S. or. for that 
matter, any plan to implement any other changes in G.E.S.'s IEP except for the administration of a WISC-R, 
which is a standard test to measure intelligence. Ms. Kuhn's recommendations are stated as follows: 

"In any case, fearing that clinical predictions for G.E.S. are fast becoming a self 
fulfilling prophecy, this examiner boldly suggests that his teachers approach him without 
any preconceptions as they try to determine for themselves what his learning pace can 
be. There is probably nothing more to be gained by further 'specialized' evaluations (at 



1335 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



least not enough to outweigh what might be perceived as additional messages that some- 
thing is wrong with him), but it will be very important in the next few months to clarify 
his rate of cognitive development." (See Petitioner's Exhibit #13) (emphasis added) 

14. On or about June 4, 1991, at an IEP meeting, a recommendation was made that G.E.S. 
"receive a neuropsychological". (See Petitioner's Exhibit #7) As a result, Dr. Raymond F. Webster, PhD., 
NCSP, a recognized authority in the field of neuropsychology, performed a psychological evaluation. This 
psychological evaluation accepted Dr. Sunder's diagnosis of G.E.S. and some of the other of Dr. Sunder's 
observations. Dr. Webster administered a battery of diagnostic tests. Based upon the review of these 
diagnostic tests and interview with G.E.S. and the Petitioner, Dr. Webster made certain conclusions and 
outlined very specific recommendations based upon a multimodal teaching strategy. Dr. Webster recognized 
that G.E.S. was exhibiting certain stress related behaviors, not unlike what had been observed by Dr. Sunder 
in his report and Ms. Taylor in her report. Dr. Webster's findings as to the existence of these behaviors is 
adopted as a finding of fact and is quoted as follows: 

"G.E.S. was referred for a comprehensive neuropsychological evaluation by Ms. Peggy 
Davenport, Director of Exceptional Children's Program with the Washington County 
Schools. The referral was prompted by Mrs. S. because of increasing difficulties 
experienced by G.E.S. with school achievement and behavior at home following school 
attendance... 

Emotionally, G.E.S. appears to be a highly distressed and intense youngster who 
approaches school with a good deal of fear and the expectation of failure. Insecurity, 
uncertainty, and feelings of being different from his peers in a negative way were 
suggested. High needs for emotional support and reassurance are evident. Impulse 
control and restraint are well below age-level expectancies and likely to be the result of 
both frontal lobe damage which is compounded by emotionally-based problems 
associated with organicity. 

G.E.S. appears to take some of his emotional distress and convert it into corresponding 
physical symptoms. Frustration, anger, and loss of control behaviorally may be 
expected along with frequent physical or somatic complaints. Data obtained from both 
mother and G.E.S. during independent interviews confirms the findings from the 
projective testing data. 

...Additionally individual counseling for him and parent effectiveness training and 
counseling for parents, especially mother, are appropriate and recommended... 

The counselors should be professional psychologists with specific expertise in working 
with youngsters who have these kinds of characteristics associated with organicity." (See 
Petitioner's Exhibit #12) 

15. Based upon the report of Dr. Webster, G.E.S. 's IEP for the school year 1991-92 was agreed 
upon. G.E.S. was recommended for a change in placement to SLD. The decision to change G.E.S. 's 
placement from EMH to SLD was based upon Dr. Webster's neuropsychological evaluation, the 
recommendation of Petitioner and the School Based Committee. (See Petitioner's Exhibit #5) 

16. Also as contained in Petitioner's Exhibit #5 is an adoption of the parent effectiveness training 
recommendation of Dr. Webster and is quoted as follows: 

"Assist mother as recommended by the neuropsychological 6/20/91." 

17. The IEP evaluation notes low frustration tolerance and that G.E.S. works slowly, and he's 
easily frustrated. (See Petitioner's Exhibit #5) 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1336 



CONTESTED CASE DECISIONS 



18. Many of the recommendations of Dr. Webster were incorporated in G.E.S.'s IEP. In some 
instances, copies of his recommendations were attached as exhibits to the IEP (See Petitioner's Exhibit #28). 

19. On or about September 17. 1991, G.E.S. was again seen by Dr. Theodore R. Sunder, 
Associate Professor, Chief, Pediatric Neurology at East Carolina University. G.E.S. was presented to Dr. 
Sunder in part to diagnose G.E.S.'s continuing symptoms of headaches. Dr. Sunder concludes and the 
undersigned finds as a fact that the headaches are a result of stress. Dr. Sunder's report is quoted as follows: 

"I feel that these (headaches) are distinctly stress related. I don't find anything to 
suggest significant vascular component at this juncture. Again I would agree that 
supportive psychotherapy as outlined and recommended by the neuropsychologist would 
be important and certainly beneficial in optimizing this young man's performance in the 
school setting. This should be carried out at a frequency determined by the therapist 

but likely would require several times weekly at the beginning " (See Petitioner's 

Exhibit #3) 

20. On or about September 17, 1991. Sue H. Hilliard, licensed physical therapist, made certain 
recommendations concerning G.E.S.'s need for physical therapy and they are adopted as findings of fact: 

"His problems of memory deficiency, frustration, and inattention are best served by 
small settings with decreased audio-verbal stimulus with allowances made for fatigue 
with fine motor deficiencies. Physical therapy should be integrated into his program to 
address his motor coordination and control deficits. The special physical education 
program initiated by you last year would not only meet the criteria established by his 
recent evaluation, but also addresses those problems specifically found with my 
evaluation." (See Petitioner's Exhibit #4) 

21. On or about September 30, 1991. Theresa Dulski, OTR/L School of Medicine. Department 
of Pediatrics. East Carolina University, made recommendations rejecting the need for direct occupational 
therapy (OT) and this conclusion is made a finding of fact as follows: 

"We both agreed that based on my clinical observation findings in which G.E.S. 
demonstrated good postural control, shoulder stability, muscle strength and good 
dynamic balance skills, direct occupational therapy services are not recommended." (See 
Petitioner's Exhibit #21) 

22. On or about November 22, 1991, in correspondence addressed to Mr. Robert J. Alligood, 
Superintendent, Washington County Schools, attorneys representing G.E.S. and Mrs. S. made the following 
demand which is adopted as a finding of fact for purposes of formally stating Mrs. S.'s position concerning 
psychological counseling: 

"It is clear that psychotherapy which G.E.S. needs will have to be provided by Dr. 
Webster or someone with similar expertise. No such psychologist can be found in 
Washington County. Therefore I and Roger Manus of Carolina Legal Assistance who 
is also representing Mrs. S. in this matter, felt that rather than scheduling another 
meeting we should formally advise you that it is absolutely necessary that psychotherapy 
as outlined and recommended by Dr. Webster be incorporated into G.E.S.'s individual 
education program at no cost to him or his parents. Also note that Dr. Sunder stated 
in his report that G.E.S. needed the therapy as recommended by Dr. Webster. 

If this psychotherapy can be included in the program, then I believe any remaining 
issues can be resolved by agreement. However, if you do not agree to provide this 
psychotherapy then we wish to request the due process hearing through the Office of 
Administrative Hearings in regard to all issues relating to this individual education 
program. Since Mrs. S. is clear in her belief that G.E.S. must have this therapy and 



1337 7:13 NORTH CAROLINA REGISTER October 1, 1992 

BSHiBiUIGUiMBiiiBBBBIBaiUliiBIIBIBaiUBaBBB^HB^SIBBBBIOUaBB! 



( 



CONTESTED CASE DECISIONS 



since the psychologist and physician who have examined G.E.S. are also in agreement 
on this point, we see no need for further evaluation of G.E.S. or for any other further 
meeting or to discuss this point." (See Petitioner's Exhibit #1) 

23. Notwithstanding the information disclosed to the Respondent in Petitioner's Exhibit #1 
concerning Tideland Mental Health Center, a recommendation was made by Respondent on January 6, 1992, 
that in order to "assist Mrs. S. an appointment will be made for G.E.S. at Tideland." 

24. On or about January 13, 1992, Mrs. S., as Petitioner, filed a petition for a contested case 
hearing in the Office of Administrative Hearings complaining of the following: 

"The agency has failed to provide my son with an adequate individualized program in 
that, among other things they have refused to provide the occupational therapy, physical 
therapy and psychological counseling necessary to his receiving a free appropriate 
education in the least restrictive environment." 

25. In the Prehearing Order received for filing on May 28, 1992, the following stipulation was 
entered into between counsel: 

"Dr. Webster's recommendations of June 20, 1991 are appropriate and should be 
implemented except that Respondent does not agree that the counselor(s) should be 
professional psychologists with specific expertise in working with youngsters who have 
the kinds of characteristics associated with organicity that G.E.S. has." 

26. By stipulation entered on record on June 8, 1992, Respondent stipulated that all 15 requests 
for admissions previously filed and dated March 13, 1992, were true and accurate except for the need for 
psychological counseling by an expert in organicity and the expertise for coordinating the services to G.E.S. 
and with the further limitation that the stipulation does not admit that these services are required by law. The 
requests for admissions are as follows: 

"1. G.E.S. needs to spend at least half of his school day in a classroom with 
a small number of students and a teacher certified in the field of learning disabilities. 

2. In any classroom situation where the teacher is not certified in the field 
of learning disabilities, but where writing or mathematics are involved, G.E.S. needs for 
the teacher to have active and direct consultation with learning disabilities specialist. 

3. G.E.S. needs to have implemented the educational recommendations 
attached as exhibit 1 (exhibit 1 contains the recommendations copied directly from Dr. 
Webster's report.). 

4. G.E.S. needs a brief respite period for every 20 minutes that he is 
involved in an academic situation. 

5. G.E.S. needs adaptive physical education. 

6. G.E.S. needs individual counseling by a professional psychologist with 
specific expertise concerning problems associated with organicity. 

7. G.E.S. needs behavior therapy by a psychologist with specific expertise 
concerning problems associated with organicity. 

8. G.E.S. needs for there to be coordination between the home and school 
concerning his behavior program. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1338 



CONTESTED CASE DECISIONS 



9. As a related educational service, G.E.S. needs parent effectiveness 

training and counseling for his parents. 

10. For meaningful improvement in gross motor coordination and control, 
G.E.S. needs physical therapy at least once a week for one hour. 

11. G.E.S. needs occupational therapy at least once a week for one hour for 
meaningful improvement of fine motor coordination and control. 

12. G.E.S. needs speech and language therapy. 

13. In order to not experience significant educational regression during the 
summer and thus have reasonable equal educational opportunity, G.E.S. needs 
educational services during the summer. 

14. An appropriate education for G.E.S. requires that there be formal 
reviews by school system representatives with his parents every six weeks concerning the 
efficacy of his educational program. 

15. G.E.S. needs a formal education reevaluation every six months." 

27. G.E.S. spends a substantial portion of his day in a LD classroom and the remainder of his 
day in the regular classroom pursuant to the IEP. Ms. Styons is G.E.S.'s LD teacher and he is benefitting 
academically from the instruction being received by her. Ms. Styons employs a multimodal teaching strategy 
and has studied at East Carolina University under Dr. Webster. 

28. A stipulation is contained in the record where counsel for Respondent and Petitioner agreed 
that Dr. Webster is not aware of the implementation of any of his recommendations contained in his report. 

29. Ms. Styons. as the learning disabilities teacher in the areas as outlined in the IEP and other 
related areas, consults on a regular basis with Ms. Alta Allen, the regular classroom teacher. 

30. Based upon the testimony of Respondent's witnesses, a substantial number of Dr. Webster's 
recommendations are being implemented in the classroom as well as being provided for in the IEP. Except 
as specifically found to the contrary herein. G.E.S.'s IEP, as well as the implementation of the IEP, reflect 
to a substantial degree the implementation of Dr. Webster's recommendations. Where the IEP or the 
implementation of the IEP does not reflect these recommendations, it is expressly found that they are either 
not necessarily appropriate or that G.E.S. will not benefit academically from their implementation or are 
otherwise unnecessary. 

31. Based upon the testimony of Respondent's witnesses, and as provided for in his IEP or 
otherwise as implemented, sufficient respite periods are provided G.E.S. during the class day. 

32. G.E.S. is provided, or it is implemented in his IEP, adaptive physical education. Randall 
Spier implements the IEP in the area of physical education and instructs G.E.S. in adaptive PE for periods 
of 30 minutes per week. 

33. G.E.S. at home has been sick, throwing up with headaches, experiencing diarrhea, refusing 
to go to school, exhibiting aggressive behavior in the afternoons, chewing his bottom lip, biting his nails and 
exhibiting other related symptoms of stress. Mrs. S. has observed G.E.S. driving a lawn mower and golf cart 
as a means of reducing stress. 

34. G.E.S.'s weekend behavior is much better than his school week behavior as it relates to 
stress. 



1339 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



35. Causality and nexus have been established between the exemplifying of stress related behavior 
at home and the fact that the behavior is generated as a result of school related environments. 

36. A person with a closed head injury such as G.E.S.'s requires a somewhat different approach 
to services than does a person with mental retardation and the expectations overall would be higher for G.E.S. 
The remediation of G.E.S.'s skills deficits requires an approach which teaches him to compensate for or work 
around his neurological problems instead of trying to strengthen his abilities in all areas. 

37. G.E.S.'s stress arises because of the natural negative feedback he gets at school as a result 
of his inability to do certain tasks because of his head injury. This negative feedback occurs even if the 
teacher is very warm and supportive. 

38. Based upon the medical reports of Dr. Webster and Dr. Sunder and the expert testimony of 
Dr. Webster, G.E.S. is in need of behavior therapy and counseling concerning reduction of fatigue and stress 
by a psychologist with specific expertise concerning problems associated with organicity. 

39. Based upon the medical report of Dr. Webster and by his expert testimony, G.E.S. is in need 
of coordination between the home and school concerning his behavior program. Mrs. Styons (or someone 
with her equivalent training and experience) in consultation with a psychologist with specific expertise 
concerning problems associated with organicity is sufficient for this coordination. 

40. Based upon the medical records of Dr. Webster and the expert testimony of Dr. Webster, 
Mrs. S. and Mr. S. are in need of parent effectiveness training and counseling as this training and counseling 
pertain to the area of G.E.S.'s stress and fatigue symptoms experienced at home. This training and counseling 
to be effective must be received from a psychologist with specific training and expertise concerning the 
problems associated with organicity. 

41. Individual counseling for G.E.S. by a professional psychologist with specific expertise 
concerning problems associated with organicity should be oriented toward teaching G.E.S. stress management 
techniques and cognitive control mechanisms. Such cognitive control mechanisms would help G.E.S. to 
recognize when he is getting fatigued and losing behavior control and give him alternative ways of dealing 
with his feelings and the overall negative impact of his self concept. The specialist in this area would set up 
a specific behavior management system for G.E.S. 

42. G.E.S.'s IEP and the implementation of the IEP call for improvement in gross motor 
coordination and control. G.E.S. is receiving appropriate physical therapy in a small physical education class 
and as a consequence he is receiving this service (or minor adjustments may be made to ensure he receives 
it). 

43. G.E.S.'s IEP and its implementation calls for speech and language therapy. Katherine Pharr 
provides speech clinician services and instructs G.E.S. in a small group setting with two other students and 
implements his IEP language therapy. She also consults with Ms. Styons on a regular basis. 

44. The paucity of evidence concerning the resolution of the issue concerning educational services 
during the summer was insufficient to carry the burden of proof as to its benefit or necessity notwithstanding 
the stipulation to the contrary. 

45. G.E.S. and his parents are presently receiving formal reviews and meetings with the School 
Based Committee and are otherwise receiving adequate notice of G.E.S.'s progress. There is no reason to 
depart from what G.E.S. is now receiving by way of review notwithstanding the stipulation to the contrary. 

46. During the 1991-92 school year, G.E.S. had the benefit of competent and caring special 
education and regular classroom teachers. These teachers implemented most of the instructional curricular 
and behavioral recommendations which are a major part of the educational recommendations found at pp. 6-10 
of the June 1991 evaluation report of Dr. Webster. (Petitioner's proposed findings of fact, pg. 5). Mrs. S. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1340 



CONTESTED CASE DECISIONS 



agreed to this IEP in the instructional phase. 

47. G.E.S. has been academically successful and maintained honor roll grades. 

Based upon the foregoing Findings of Fact, the undersigned makes the following: 

CONCLUSIONS OF LAW 

1 . The Office of Administrative Hearings has jurisdiction over the person and subject matter of 
this contested case pursuant to Chapters 115C and 150B of the North Carolina General Statutes. 

2. As stated in G.S. 1 15C-106, it is the public policy of the State of North Carolina to ensure 
every child a fair and full opportunity to reach his full potential. 

3. G.E.S. suffers from a diffuse encephalopathy with bifrontal dysfunction associated with 
medical complications at birth and likely caused by a subarachnoid hemorrhage. G.E.S. is experiencing rather 
diffuse and generalized cerebral and likely cerebellar inefficiency. G.E.S. requires a multifaceted treatment 
program involving both direct and consultative LD services at the Pines Elementary School, Washington 
County, Plymouth, North Carolina. As a consequence of G.E.S. 's disability, he is a child with "special 
needs" and entitled to special education and related services as defined in G.S. 115C-109. G.E.S. is also a 
child with a disability as defined in the Individuals With Disabilities Education Act, 20 USCA 1401, et seq . 

4. G.E.S. is entitled to "special education" services as that term is defined in G.S. 115C-108. 

5. G.E.S. is entitled to "related services" as that term is defined in G.S. 115C-108. 

6. G.E.S. in entitled to a free appropriate education as a consequence of his being defined as 
a child with special needs as provided in G.S. 1 15C-1 1 1 . 

7. G.E.S. is entitled to the preparation and implementation of an individualized educational 
program (IEP) as defined in G.S. 1 15C-1 13(f) as a consequence of being defined as a child with special needs. 

8. On or about August 14, 1990, Dr. Theodore R. Sunder, Associate Professor, Chief, Pediatric 
Neurology, East Carolina University, suggested behavioral therapy. 

"In addition he will require behavioral therapy, likely by an organic psychologist with 
some experience in working with head injured individuals." 



9. On or about January 4, 1991, Respondent classified G.E.S. as EMH. (Petitioner's Exhibit 



#11) 



10. On or about February 4, 1991, Mrs. S., in correspondence to Mrs. Peggy Davenport 
expressed concern about her son's emotional needs: 

"Apparently, his needs are not being met because there are obvious signs of frustration 
and low self esteem. G.E.S. is experiencing headaches, upset stomach and behavior 
problems not only at home but at school as well." 

11. A psychological evaluation was performed by Shirley P. Kuhn, MS. Ms. Kuhn notes in her 
evaluation Dr. Sunder's diagnosis: 

"Including speech/language, physical, and occupational therapy, as well as behavior 
therapy and management, all integrated into a highly structured academic program in 



1341 7:13 NORTH CAROLINA REGISTER October 1, 1992 

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CONTESTED CASE DECISIONS 



a self contained learning disabilities classroom setting." 

However, Ms. Kuhn, in her recommendation states: 

"In any case, fearing that clinical predictions for G.E.S. are fast becoming a self 
fulfilling prophecy, this examiner boldly suggests that his teachers approach him without 
any preconceptions as they try to determine for themselves what his learning pace can 
be. There is probably nothing more to be gained by further 'specialized' evaluations (at 
least not enough to outweigh what might be perceived as additional messages that 
something is wrong with him), but it will be very important in the next few months to 
clarify his rate of cognitive development." (emphasis added) 

Her only recommendation was the administration of the WICS-R. No recommendation was made as 
to the correct designation of G.E.S. from the classification as EMH; no recommendation was made as to 
implementation of Dr. Sunder's diagnosis and recommendations as to behavior therapy. There was an express 
recommendation that no further psychological evaluation be made of G.E.S. as this would only undermine 
his self esteem and likely be a "self fulfilling prophecy." (Petitioner's Exhibit #13) 

12. On or about June 4, 1991, at an IEP meeting, a recommendation was made that G.E.S. 
"receive a neuropsychological". (Petitioner's Exhibit #7) As a result. Dr. Raymond F. Webster, PhD., 
NCSP, a recognized authority in the field of neuropsychology, performed a psychological evaluation. This 
psychological evaluation accepted Dr. Sunder's medical diagnosis of G.E.S. and paralleled other of Dr. 
Sunder's recommendations. Dr. Webster administered a battery of diagnostic tests. Based upon those 
diagnostic tests, Dr. Webster outlined very specific recommendations based upon a multimodal teaching 
strategy. Again, Dr. Webster noted G.E.S.'s symptoms as reported by Mrs. S. concerning stress and 
behavior and also observed these in his testing of G.E.S. 

"Additionally, individual counseling for him and parent effectiveness training and 
counseling for parents, especially mother, are appropriate and recommended." 

(Petitioner's Exhibit #12) 

This was the second major recognition by a highly trained professional that stress related problems 
existed. Further, Mrs. S. had stated this fact to Respondent in her correspondence of February 4, 1991. 
(Petitioner's Exhibit #9) 

13. G.E.S.'s School Based Committee, on or about September 5, 1991, reclassified G.E.S. as 
SLD which was a change in the previous classification. 

"The above decision was based on the following: neuropsychological, parent recommen- 
dation, SBC recommendation." 

It further states: 

"Assist mother as recommended by the neuropsychological 6/20/91." 

The IEP evaluation notes again low frustration tolerance and that he (G.E.S.) works slowly, he's 
easily frustrated. Many of the other recommendations of Dr. Webster were approved for implementation in 
the IEP. (Petitioner's Exhibit #5) 

14. Again, G.E.S. was evaluated by Dr. Sunder on September 17, 1991. Dr. Sunder reports: 

"Unfortunately he had an association with his significant degree of stress, primarily 
manifested by late afternoon headaches." 

Dr. Sunder reports from the standpoint of his headaches: 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1342 



CONTESTED CASE DECISIONS 



"I feel that these are distinctly stress related. I don't find anything to suggest significant 
vascular component at this juncture. Again, I would agree with supportive psychothera- 
py as outlined and recommended by the neuropsychologists would be important and 
certainly beneficial in optimizing this young man's performance in the school setting. 
This should be carried out at a frequency determined by the therapist, but likely would 
require several times weekly at the beginning." 

15. Between the time of the adoption of the IEP in September, 1992, and January 6, 1992, no 
related services were provided to G.E.S. or the Petitioner concerning stress as recommended by both Dr. 
Webster and Dr. Sunder. 

16. A demand for those services was made by the Petitioner's attorneys on or about November 
22. 1991. (Petitioner's Exhibit #1) 

17. Notwithstanding the information disclosed to the Respondent in Petitioner's Exhibit #1 
concerning Tideland Mental Health Center and the lack of anyone in that clinic with expertise in 
neuropsychology, a recommendation was made by Respondent on January 6, 1992, that in order to "assist 
Mrs. S. an appointment will be made for G.E.S. at Tideland." 

18. Respondent does not deny the validity of the recommendations of Petitioner's experts, 
particularly Dr. Webster. Respondent's main issue concerning the recommendation was whether or not 
G.E.S. was legally entitled to the psychological services as a "related service" rendered by someone familiar 
with neuropsychology. 

19. Based upon the expert testimony of Dr. Webster, his report (Petitioner's Exhibit #12) and Dr. 
Sunder's report (Petitioner's Exhibit #3). both professionals with impeccable credentials in their field of 
expertise and as accepted by the Respondent in stipulations, it cannot be denied that G.E.S. and Mrs. S. (as 
well as Mr. S.) are in need of and entitled to this counseling under applicable law. The question of the scope 
and magnitude of this counseling is the main issue at the heart of this contested case hearing. 

20. Under the provisions of G.S. 115C-108, the term 'related services' means... counseling 
services... the term also includes... parent counseling and training and assisting parents in understanding the 
special needs of their child." 

21. Related services have been judicially held to include speech pathology and audiology, 
psychological services, physical and occupational therapy, recreation, early identification and assessment of 
disabilities in children, counseling services and medical services for diagnostic or evaluation purposes. 

22. Section 1501(1) of the policy statement of the Department of Public Instruction defines 'related 
services' to include "(6) parent counseling and training means assisting parents in understanding the special 
needs of their child and providing parents with information about child development. (8) Psychological 
services include consulting with parents, teachers and other school personnel and planning program and 
services to meet the identified needs of children..." "Planning and managing a program of psychological 
services including psychological counseling for children and parents." 

23. Respondent is charged with the statutory duty of providing G.E.S. with related services if 
Petitioner has established by the greater weight of the evidence that G.E.S.'s special education will benefit. 
There has been established a sufficient causative relationship between the symptoms exhibited by G.E.S. at 
home (headaches, nausea, diarrhea, etc.) and stress related to his educational environment. It is specifically 
concluded that Respondent is charged with the statutory duty to provide G.E.S. with related services if 
Petitioner has established through stipulation and by the greater weight of the evidence that these services will 
benefit G.E.S.'s special education and give to him an opportunity to achieve his full potential commensurate 
with that given other children. G.E.S. is entitled to the services of a licensed psychologist who has expertise 
in organicity in order to provide psychological counseling to G.E.S. and Mrs. S. (and Mr. S.) at a frequency 
to be determined by the therapist. This therapy and counseling should be limited to therapy related to coping 



1343 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



with and eliminating (to the extent possible) these symptoms because of their direct relationship to causative 
variables attributed to G.E.S.'s school environment. Although G.E.S. may benefit from other psychotherapy 
relating to his disability, no causative evidence has been produced which would link this need to his 
educational environment. No other legally sufficient rationale can be made, based upon the Findings of Fact, 
for the undersigned to conclude that any and all psychological therapy is required to be provided to G.E.S. 
or his parents by Respondent. 

24. The psychological services as specified above are "related services" under the term "special 
education" and are to be provided to G.E.S. and his parents at no cost to them. 

25. Based upon the testimony of the other witnesses who are familiar with G.E.S., particularly 
his teachers, the remainder of G.E.S.'s IEP is appropriate and substantially incorporates the recommendations 
of Dr. Sunder and Dr. Webster and are being commendably provided to G.E.S. 2 

26. Based upon the report of Theresa Dulski (Petitioner's Exhibit #2) it is recommended that OT 
therapy services to improve fine motor dexterity skills not be provided to G.E.S. 

27. The IEP was appropriately implemented to meet G.E.S.'s needs. 

28. Except as indicated herein no other omission or failure was found to justify a remedy to the 
Petitioner. 

29. Based upon the testimony of Respondent's witnesses and the Petitioner, the remainder of 
G.E.S.'s IEP provides G.E.S. with a free and appropriate education through an appropriate individualized 
education program pursuant to State and federal law and has not otherwise denied G.E.S. his right to a free 
appropriate education by failing to provide him the necessary related services; G.E.S.'s individualized 
education plan is appropriate and is being implemented to meet his needs. In fact, as evidenced by the 
testimony of Respondent's witnesses and the Petitioner (and further Petitioner's own Proposed Finding of 
Fact), G.E.S.'s IEP is being commendably implemented. 

30. G.E.S. spends a substantial portion of his day in a LD classroom and the remaining portion 
of his day in a regular classroom. Ms. Styons is G.E.S.'s LD teacher and he is benefitting academically from 
the instruction being received by her. Ms. Styons employs a multimodal teaching strategy and has studied 
at East Carolina University under Dr. Webster. 

31 . Ms. Styons, as the learning disabilities teacher in the areas as outlined in the IEP and in other 
related areas, consults on a regular basis with Ms. Alta Allen, the regular classroom teacher. 

32. Based upon the testimony of Respondent's witnesses and as provided for in his IEP or 
otherwise implemented, sufficient respite periods are provided to G.E.S. during the class day. 

33. G.E.S. is provided for or it is implemented in his IEP, adaptive physical education. Randall 
Spier implements the IEP in the area of physical education and instructs G.E.S. in adaptive PE for periods 
of 30 minutes per week. 

34. G.E.S.'s IEP and the implementation of the IEP call for improvement in gross motor 
coordination and control. G.E.S. is receiving appropriate physical therapy in a small physical education class 
and, as a consequence, he is receiving this service. 

35. G.E.S.'s IEP and its implementation call for speech and language therapy and he is receiving 



Particularly it was observed by the undersigned that Mrs. Styons was providing services to G.E.S. in a 
highly significant way. This could also be said of the many other fine teachers and personnel associated with 
G.E.S.'s IEP and its implementation. 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1344 



CONTESTED CASE DECISIONS 



the appropriate services in this area. 

36. The paucity of evidence concerning the resolution of the issue concerning educational services 
during the summer was insufficient notwithstanding the stipulations of record. The undersigned finds that no 
conclusion may be made as to the educational services during the summer as meeting the legal standards for 
related services or as required by law. 

37. G.E.S. and his parents are presently receiving formal reviews in meetings with the School 
Based Committee and are otherwise receiving adequate notice of G.E.S. 's progress. Therefore it cannot be 
concluded that this service is in any way inadequate as presently provided. 

38. Based upon the medical report of Dr. Webster and by his expert testimony, G.E.S. is in the 
need of coordination between the home and school concerning his behavior program. Mrs. Styons (or 
someone with her equivalent training and experience) in consultation with a psychologist with specific 
expertise concerning problems associated with organicity is sufficient for this coordination. 

39. Physical therapy should be integrated into his program to address his motor coordination and 
control deficits. The special physical education program devised in his IEP is sufficient and meets the 
requirements of law. 

40. Based upon the report of Theresa Dulski and what is otherwise required by law, direct 
occupational therapy services are not to be implemented. 

41. G.E.S.'s need for formal education revaluation and formal reviews by school system 
representatives with G.E.S. "s parents should be no more or less than the maximum required by law unless 
otherwise indicated in the IEP. 



Based upon the foregoing Findings of Fact and Conclusions of Law, the undersigned makes the 
following: 

DECISION 

1 . Respondent is charged with the statutory duty to provide G.E.S. with related services in order 
to give G.E.S. an opportunity to achieve his full potential commensurate with that given other children. 

2. G.E.S. is entitled to the services of a licensed psychologist who has expertise in organicity 
in order to provide psychological counseling to G.E.S. and Mrs. S. (and Mr. S.) at a frequency to be 
determined by the therapist. This therapy and counseling should be limited to therapy related to coping with 
and eliminating (to the extent possible) those symptoms related to stress created from the classroom 
environment. Since these psychological services as specified are "related services" under the term "special 
education" they are to be provided to G.E.S. and his parents at no cost to them. 

3. There shall be implemented a behavior program between school and home for G.E.S. Mrs. 
Styons (or someone with her equivalent training and experience) in consultation with a psychologist with 
specific expertise concerning problems associated with organicity is sufficient for directing this coordination. 

4. Except as herein ordered. Petitioner is not entitled to any other relief concerning the 
educational services provided to G.E.S. 

5. This cause is retained for further orders as may be necessary. 



NOTICE 

In order to appeal this Decision, the person seeking review must file a written notice of appeal with 

1345 7:13 NORTH CAROLINA REGISTER October 1, 1992 



CONTESTED CASE DECISIONS 



the North Carolina Superintendent of Public Instruction. The written notice of appeal must be filed within 
thirty (30) days after the person is served with a copy of this Decision. G.S. 1 15C-1 16(h) and (i). 



This the 28th day of August, 1992. 



Julian Mann, III 

Chief Administrative Law Judge 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1346 



NORTH CAROLINA ADMINISTRATIVE CODE CLASSIFICATION SYSTEM 



1 he North Carolina Administrative Code (NCAC) has four major subdivisions of rules. Two of these, 
titles and chapters, are mandatory. The major subdivision of the NCAC is the title. Each major 
department in the North Carolina executive branch of government has been assigned a title number. 
Titles are fiirther broken down into chapters which shall be numerical in order. The other two, 

subchapters and sections are optional subdivisions to be used by agencies when appropriate. 



TITLE/MAJOR DIVISIONS OF THE NORTH CAROLINA ADMINISTRATIVE CODE 
TITLE DEPARTMENT LICENSEVG BOARDS CHAPTER 



1 


Administration 


2 


Agriculture 


3 


Auditor 


4 


Economic & Community Development 


5 


Correction 


6 


Council of State 


7 


Cultural Resources 


x 


Elections 


9 


Governor 


10 


Human Resources 


1 1 


Insurance 


12 


Justice 


13 


Labor 


14A 


Crime Control & Public Safety 


15A 


Environment. Health, and Natural 




Resources 


16 


Public Education 


17 


Revenue 


18 


Secretary of State 


19A 


Transportation 


20 


Treasurer 


21 


Occupational Licensing Boards 


:: 


Administrative Procedures 


23 


Communitv Colleges 


24 


Independent Agencies 


25 


State Personnel 


26 


Administrative Hearings 



Architecture 2 

Auctioneers 4 

Barber Examiners 6 

Certified Public Accountant Examiners 8 

Chiropractic Examiners 10 

General Contractors 12 

Cosmetic Art Examiners 14 

Dental Examiners 16 

Dietetics/Nutrition 17 

Electrical Contractors 18 

Electrolysis 19 

Foresters 20 

Geologists 21 

Hearing Aid Dealers and Fitters 22 

Landscape Architects 26 

Landscape Contractors 28 

Marital and Family Therapy 31 

Medical Examiners 32 

Midwifery Joint Committee 33 

Mortuary Science 34 

Nursing 36 

Nursing Home Administrators 37 

Occupational Therapists 38 

Opticians 40 

Optometry 42 

Osteopathic Examination & Reg. (Repealed) 44 

Pharmacy 46 

Physical Therapy Examiners 48 
Plumbing. Heating & Fire Sprinkler Contractors 50 

Podiatry Examiners 52 

Practicing Counselors 53 

Practicing Psychologists 54 

Professional Engineers & Land Surveyors 56 

Real Estate Commission 58 

Refrigeration Examiners 60 

Sanitarian Examiners 62 

Social Work 63 
Speech & Language Pathologists & Audiologists 64 

Veterinary Medical Board 66 



Note: Title 21 contains the chapters of the various occupational licensing boards. 



1347 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



CUMULATIVE INDEX 



CUMULATIVE INDEX 

(April 1992 - March 1993) 



Pages 



Issue 



1 - 105 1 April 

106 - 173 2 - April 

174 - 331 3 - May 

332 - 400 4 - May 

401 - 490 5 - June 

491 - 625 6 - June 

626 - 790 7 - July 

791 - 902 8 - July 

903 - 965 9 - August 

966 - 1086 10 - August 

1087 - 1154 11 - September 

1 155 - 1253 12 - September 

1254 - 1350 13 - October 



ADMINISTRATION 

Auxiliary Services, 4 

Motor Fleet Management Division, 



794 



AGRICULTURE 

Gasoline and Oil Inspection Board, 336 

Pesticide Board, 1276 

Plant Industry, 904 

Structural Pest Control Committee, 332 

Veterinary Division, 342 

CULTURAL RESOURCES 

U.S.S. Battleship Commission, 911 

ECONOMIC AND COMMUNITY DEVELOPMENT 

Banking Commission, 629 
Community Assistance, 909, 968 
Departmental Rules, 801 

ENVIRONMENT, HEALTH, AND NATURAL RESOURCES 

Adult Health, 1199 

Coastal Management, 211, 655, 1098 

Departmental Rules, 826 

Environmental Health, 223 

Environmental Management, 190, 416, 500, 644, 830, 1013 

Governor's Waste Management Board, 564, 920, 1 197 

Health: Epidemiology, 140, 1212 

Health: Personal Health, 1217 

Health Services, 52, 659, 1174 

Marine Fisheries, 530 

NPDES Permits Notices, 1, 107 

Radiation Protection, 136 

Sedimentation Control, 920 



7:13 NORTH CAROLINA REGISTER October 1, 1992 



1348 



CUMULATIVE INDEX 



( 



Vital Records. 565 

Wildlife Resources Commission, 28, 133, 408, 449. 551, 921, 1299 

Wildlife Resources Commission Proclamation, 176 

FINAL DECISION LETTERS 

Voting Rights Act, 106, 174. 406, 493, 628, 793, 966, 1090, 1275 

GENERAL STATUTES 

Chapter 150B, 1254 

GOVERNOR/LT. GOVERNOR 

Executive Orders. 401, 491, 626, 791, 903, 1087, 1155 

HUMAN RESOURCES 

Aging, Division of. 121, 346 

Day Care Rules, 123 

Economic Opportunity, 5 

Facility Services, 111, 177, 496, 634, 980 

Medical Assistance, 4, 415, 496, 816, 989, 1156, 1295 

Mental Health, Developmental Disabilities and Substance Abuse Services, 111, 297, 409, 809, 1092, 1276 

Social Services Commission. 183, 911 

LNDEPENDENT AGENCIES 

Housing Finance Agency. 450, 576, 928, 1219 

INSURANCE 

Consumer Services Division, 125, 1157 

Departmental Rules, 7, 1095 

Engineering and Building Codes, 19, 643 

Financial Evaluation Division. 1162 

Fire and Rescue Services Division, 17 

Hearings Division, 124. 1096 

Life and Health Division, 22, 347, 1167 

Property and Casualty Division, 20 

Seniors' Health Insurance Information Program, 132 

JUSTICE 

Alarm Systems Licensing Board, 27, 189. 643, 919 

Criminal Information, 1097 

General Statutes Commission, 353 

Private Protective Services, 918 

Sheriffs Education and Training. 990 

State Bureau of Investigation, 188, 499 

LICENSING BOARDS 

Architecture. 1111 

Certified Public Accountant Examiners, 355 

Cosmetic Art Examiners, 360, 922 

Dietetics/Nutrition, 923 

Electrolysis Examiners, 69, 700 

Medical Examiners, 1304 

Nursing. 232, 700 

Professional Engineers and Land Surveyors, 566 

Speech and Language and Pathologists and Audiologists, 705 



1349 7:13 NORTH CAROLINA REGISTER October 1, 1992 

L 



CUMULATIVE INDEX 



LIST OF RULES CODIFIED 

List of Rules Codified, 72, 362, 452, 584 

PUBLIC EDUCATION 

Departmental Rules, 1 108 
Elementary and Secondary, 852, 1108 

REVENUE 

License and Excise Tax, 712 
Motor Fuels Tax, 361 

STATE PERSONNEL 

Office of State Personnel, 237, 705, 1113 

TAX REVIEW BOARD 

Orders of Tax Review, 494 

TRANSPORTATION 

Highways, Division of, 228, 856, 1062, 1110 
Motor Vehicles, Division of, 68, 142 



7:13 NORTH CAROLINA REGISTER October 1, 1992 1350 



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